Opening A Bank Account In Panama: How To Get An Offshore Account

Opening a bank account in Panama is a good way to diversify. It provides you with a backup against any financial disaster in your primary country. If you are planning on spending time in Panama, then a bank account here will make daily life far easier. You will a Panamanian bank account to obtain a mortgage if you are purchasing property here.

A bank account will allow you to make an investment in Panama. The real estate market continues to show potential. There are also plenty of opportunities to make money through agricultural investments.

Opening a bank account in Panama used to be a popular way to hide money from the authorities. Today, this is no longer possible and people choosing to bank in Panama do so for legitimate reasons.

Who Qualifies?

If you have a Cedula (proof of residency) getting a bank account will be easy. Of course you need to have a Panamanian bank account to get a Cedula, but that’s a topic for another day. If you are a citizen on the Friendly Nations list things will be simple for you. For American citizens things are a little more complicated. A big reason for that is thanks to FACTA.

FACTA

The Foreign Account Tax Compliance Act is a law passed in 2010 that forced U.S. citizens to report any foreign holdings or income, and pay tax on it. Overseas banks and financial institutions are also required to let the IRS know the identities of any United States citizens with holdings. Companies that fail to comply face exclusion from U.S. markets. They will also face financial penalties.

The costs involved with staying compliant are extreme. As a result, most foreign banks are wary of dealing with U.S. citizens. However there are still banks in Panama that are happy to have your custom.

Best Banks To Open An Account At

If you are not a resident in Panama, you will find that most banks refuse to deal with you. The list of banks who might help changes all the time, but as of 2019, the best ones to try are Banistmo, Banesco and Scotia.

The best place to open an account is Panama City. Most of the banks have offices here, so you have a higher chance of success. If you already have residency, you will be able to open an account at most banks. For convenience, you should open an account in a bank with a branch close to your home.

What You Will Need

You will need to provide the following documentation before you are allowed to open an account.

A letter from your bank in your bank back at home

Passport

Another form of ID such as driving license or Cedula

Proof that you have a valid reason for being in Panama. This includes owning a titled property, or proof that you are applying to be a citizen here. If you are in the process of gaining citizenship, you have to provide copies of the documentation.

A utility bill from your address in Panama. In general any utility bill will do, it doesn’t have to be in your name. For example a bill in your landlord’s name is fine. But the bank want to see a bill that proves your Panamanian address.

You may need to provide proof of income. This can come from a job pension.

You will need to to transfer some money to open the bank account. This could be as little as US$50 dollars or up to US$5000.

U.S. citizens may need to provide details of any credit cards they hold.

Other Things To Be Aware Of

Customer service in Panamanian banks can be terrible. Some workers will tell you they don’t accept American citizens simply to avoid the paperwork. If you know this isn’t true you can try again at another bank.

You will need to speak some Spanish to open an account. If you don’t speak Spanish, arrange to go with someone who can help you translate.

American citizens will often have to explain any large deductions from their bank accounts. If you take out cash of more than a couple of thousand dollars, you will need to explain what you intend to do with it.

If you know a banker, or have a contact that works in the banking industry be sure to take advantage of it. In many cases they will be able to help you out and avoid some of the problems that seem to crop up.

Oliver Lovett

Summary