digital banks

The best digital banks for e-residents’ businesses in 2022

by Dagne Aaremäe

Have you been researching about e-Residency and stumbled upon people having trouble with opening a bank account in Estonia? It is a big myth in the communities, that you need to have an Estonian bank account for your Estonian entity. Since in 2019 the share capital can be paid in with any European payment institution, who can provide the demanded certificate. As a result, there are not many cases when an e-resident´s company needs to get a bank account in Estonia.

Digital bank accounts or the so called fintech solutions are used more often.  Mainly because a digital bank account, as the name indicates, is set-up fully online and doesn’t require your business to have a connection to Estonia.

In this article we are going to review some of the most useful and interesting digital banks for e-residents.

You will find out:

  • What are the pros and cons of different fintech companies? 
  • Who does Silva Hunt recommend the most? 

Note! Since these are not traditional banks you:

  • Can’t get a credit card. 
  • Can’t set up a savings account and earn interest. 
  • Can’t get a loan. 
  • There is no overdraft for your account. 

Wise

What is it known for?

Want to make transactions with multiple currencies up to 6 times cheaper than traditional banks or 19x cheaper than Paypal? Then you should consider Wise, formerly known as Transferwise. Wise is well known for their mid-market exchange rate policy for all transfers, which makes their conversion fees one of the lowest. Furthermore, Wise is more transparent about their fees than any other fintech solution. You can find out exactly what their fee consists of here.

You can open a business bank account easily and integrate it with Stripe or Paypal with direct debits to your native accounts.

What can you do with the Wise Business account?   

  • Pay in the share capital for your Estonian OÜ and get a certificate that proves it.  
  • Get a local bank account number without having a local address in the USA, Australia, UK, Hungary, New Zealand, Romania, Singapore and Europe (Belgium IBAN).   
  • You can hold up to 50 currencies on your account. 
  • Possible to get a debit card (backed by Mastercard). Find out if your desired country is on the list.
  • Manage your finances with a user-friendly mobile app.  
  • Wise API lets you connect your company account with your business tools. 
  • You can set up direct debits.  
  • Get fast customer support.  

Limitations  

  • Doesn’t support cryptocurrency. You can’t send money to a cryptocurrency platform. You can receive money to your Wise account from a platform that deals with cryptocurrencies — as long as the platform is regulated and/or supervised in the EU or UK.
  • Your money is protected and safeguarded, but not guaranteed by the Financial Services Compensation Scheme (FSCS).  
  • Wise doesn’t accept cash or cheque payments to your account.  
  • Can´t earn interest with their account.

Costs

There are no monthly fees to maintain a Business account with Wise. For an Estonian business, there is only a 50€ set-up fee to get an IBAN number and the possibility to withdraw money from platforms like Shopify and Stripe for example.  Sending money to another Wise Business account is free. However, sending money to a non-Wise account will always be charged, even for domestic transfers.  You can withdraw money from an ATM up to 200£ /month without being charged, over that + 0.50 EUR per withdrawal.

If you transfer money to another currency the conversion fee starts from 0.35%.

Read about the prices in more detail here .

PS!

Thresholds and fees to hold EUR have changed from 18.th Jun-2022:

  • It’s free for businesses to hold any amount of EUR funds on the account.

Revolut

What is it known for?

Another Fintech company that has rapidly grown is Revolut. Similarly to Wise Revolut also offers cheap currency transfers. It is especially well suited for people who travel a lot and send money to other Revolut accounts. Revolut is often praised for their supreme user experience on their app. Compared to Wise, Revolut has many additional whistles and bells in their app, having especially great features for budgeting.

 What can you do with the Revolut business account?  

  • Get a local bank account in EUR (LT IBAN) or GBP.  
  • Hold more than 30 currencies on your account and spend money abroad at the real (interbank) exchange rate.  
  • You can track your spendings and categorize them in their mobile app.   
  • Their premium package provides Global medical insurance.    
  • Open API to automate payments and connect to platforms (like Xero & Stripe).  
  • You can set up direct debits.  
  • You can trade in cryptocurrency, stocks, commodities, gold etc.   
  • They have a bank licence, which means that your holdings are guaranteed up to 100 000 EUR.  

Limitations  

  • Can’t pay the share capital as they don’t provide a certificate to confirm payment of share capital to a registration court.  
  • Higher transfer fees on the weekends.  
  • No cash or cheque deposits are accepted to your Revolut account.  
  • Because Revolut has a banking licence it is harder to open a business bank account than with Wise. Much more documents need to be presented and it might take a longer time than expected. They can decline your application if their compliance department finds your business too risky.  

Costs

Unlike Wise and Paysera, Revolut charges business accounts based on a monthly fee not based on a percentage fee with each transfer. Which can make Revolut much more expensive, especially if you don´t have a lot of transactions. Revolut´s business package offering starts from 25 EUR a month.

Of course, you could try the free package, however, a big drawback is – you won’t be able to connect your business tools with the Revolut API, do bulk payments or manage team members permissions. You can get a more detailed overview of their prices here.

Revolut has a neat feature for traders. As an investor you will have access to commission-free trades – Metal users can access unlimited commission-free trades a month.

When it comes to local transfers you can do a certain amount of transfers for free (depending on your package), if you go over you´ll be charged +0.20€ per local transfer.

Be aware that Revolut adds  +0.5% to currency exchange fees on weekends. This is added to all major currencies (USD, GBP, EUR, AUD, CAD, NZD, CHF, JPY, SEK, HKD, NOK, SGD, DKK, PLN, and CZK). So you should plan your transactions more if you want to avoid this fee.

Paysera

What is Paysera known for?

Paysera is often used by e-shop owners as it provides a great payment gateway API.

They seem to be quite innovative and ambitious, for example, you can collect payments with premium-rate SMS messages. You can get an idea about how it works here.

 In order to open a bank account for your business, you need to have a personal account with them first.

What can you do with Paysera?  

  • You can pay in the share capital.  
  • You will get 2 different IBANs – an IBAN in BGN and an IBAN in EUR.  
  • SEPA Instant transfers in EUR.  
  • Provides payment gateway API.  
  • Collect payments with premium-rate SMS messages.  
  • You can set up direct debits.  
  • No charge for currency conversions inside your account.  
  • Hold up to 30 currencies on your account  
  • Make money transfers to over 180 countries.   
  • You can deposit cash to your Paysera account by going to any EasyPay office or via a B-Pay ATM.  

  Limitations

  • Doesn’t support cryptocurrency  
  • If you keep money and make payments in non-euro currency, the funds are automatically converted into euro.  
  • Paysera payment cards are issued to all countries, however, the delivery is only possible to the EEA countries.  
  • Your money is protected and safeguarded, but not guaranteed by the Financial Services Compensation Scheme (FSCS).  

Costs

Transfers in euros: when a payment is done to another Paysera account in the EU the transaction is free. When the transfer is done to a bank account in the EU the fee is 0,20€.

Transfers outside of Europe cost 1€ for businesses. You can see other currency fees here.

If your company is registered in Estonia the business account set up is for free.

Intergiro

What is Intergiro known for?

Intergiro focuses only on providing accounts for businesses.  They give you a highly customisable API, which is great for digital businesses who want to build their own banking service.

This digital bank doesn’t use chatbots and likes to keep the customer support personal. For this reason, their clients really like their smooth onboarding process.

What can you do with Intergiro?  

  • Can support 10 currencies.  
  • You can pay in the sharecapital.
  • Multi-currency accounts are available in USD, GBP and EUR.  
  • You can build a customised payment solution for your product. Choose custom expiry dates for your MasterCard.  
  • Onboard fast in a more personal way.   
  • You can trade with licenced cryptocurrencies.  
  • Intergiro helps you to get PCI compliant.  
  • You can control your employees account permissions and limits.  
  • Your IBAN receiving bank details will be Swedish.  

Limitations 

  • Doesn´t have as many currency options yet as others on this list.  
  • Their SEPA IBANs can accommodate SEPA credit transfers only, but not Direct Debit for the time being.   
  • Your money is protected and safeguarded, but not guaranteed by the Financial Services Compensation Scheme (FSCS).  
  • No cash deposits are accepted.  

Costs

Opening an account is free. Getting an account with multi-currency IBAN price starts from 30€ a month the package is called Growth. With this package the multi-currency payments cost 1%. ATM withdrawls cost 1.50€ each.

For large or complex businesses, they have a custom package. You can see their services in more detail here.

In conclusion

There are many fintech solutions on the market but few of them have proven to be really useful as banks for e-Residents. In this article we have collected many pros and cons about these fintech companies and you have to make your decision dependant on your needs. So far, we have had best experience with Wise and if you are ready to set your bank account with them simply click HERE to start!