Can Israeli start ups open US Bank Accounts?

A typical line in an Israeli Bank :-)

Like many Israeli start ups, your company is targeting the US market. You are about to start sales in the US, and you currently accept both credit card and PayPal payments. On the expense side, you’re making payouts to suppliers in the US, but the Israeli banks are charging you outrageous fees and it takes time for transactions to complete, exposing you to currency volatility. Some questions arise:

The question of whether an Israeli start up should open a US bank account probably comes up in many Israeli start ups.

Joshua Nowack, Chief Numbers Guy at Nowack Strategic Business Advisory & CPA, answered these questions on LinkedIn’s Q&A Service, and I thought it would be good to share them with the readers of VC Cafe.

1) Yes, you can maintain a US-dollar denominated account in the US without having a physical presence.

2) Due to patriot act issues (dealing with the US effort to fight money laundering especially with terrorists), they usually want to see you in person with ID. You might need to have a US tax ID number as well. Not sure if the bank would require it.

3) HSBC would be a great choice from the standpoint of its strong international presence not just here, but everywhere in the world (considering your future growth). Bank Leumi also maintains a US presence, I believe in New York.  (VC Cafe: Silicon Valley Bank operates both in the US and Israel, with a service tailored for start ups. Read more at: Silicon Valley Bank Named Top Bank for Cleantech Companies).

4) The implications of opening account are somewhat limited, but things to consider should include:

Bottom line is the bank itself is one piece of the puzzle. Bank Leumi/HSBC/SVB should be able to offer you some additional insight into the matter.

Bottom line #2 is: use the resources available to you for information. LinkedIn Q&A is a great example.

Thanks for visiting again. If you enjoyed this article, Get VC Cafe delivered by email or subscribe using your Feed Reader and original feed RSS
June 24, 2009 | Comments
Filed Under 101, Israel

 

Comments

blog comments powered by Disqus

  • Recent Comments

  • Recent Posts