As Singapore strengthens its position as a global financial hub, banks have significantly raised the bar on regulatory compliance, anti-money laundering (AML), and risk management standards. In recent years, this tightening of banking norms has resulted in an increasing number of forced closures of corporate bank accounts, especially those held by overseas or cross-border entities.
Notably, even longstanding domestic accounts have not been immune to these closures. Often, businesses receive no prior warning, making the account termination sudden and highly disruptive. In some cases, companies are left scrambling to find alternatives, leading to delays in payments, payroll, and day-to-day operations.
Why This Matters
Why Are Corporate Bank Accounts in Singapore Being Shut Down?
1. Inactivity in Accounts or Low Usage
2. Non-Compliance with AML/CFT Norms
3. Delayed or Missing Documentation
4. Suspicion of Financial Crime
5. Opaque Ownership or Structure
6. Suspicious Transaction Behaviour
7. Account Managed by a Third Party
8. High-Value Transactions with High Risk Jurisdictions
9. Outstanding Tax or Legal Issues
10. Regulatory Breaches
11. Changes in Internal Policies
12. Frequent Transfers with Personal Accounts
How to Protect Your Corporate Bank Account in Singapore
While external regulations are beyond a business’s control, proactive management and sound banking practices can significantly reduce the risk of forced account closures.
Here’s how to stay compliant and safeguard your account:
- Keep the account active: Make sure to maintain a baseline of legitimate activity even when business is slow to avoid the account becoming dormant.
- Stay compliant to AML and CFT laws: All your transactions should be documented properly and aligned with the established legal and ethical standards in Singapore. Avoid dealings with high-risk jurisdictions where possible.
- Respond to banks promptly: Keep your bank updated with any changes in shareholders, directors, or business activity, and respond to document requests on time.
- Maintain transparency: Establish a clear business model and structure. Notify your bank about the new lines of business or corporate changes.
- Monitor legal obligations: Stay informed about compliance requirements and updates from local regulatory authorities in each jurisdiction.
- Engage with a Compliance Advisor: Work with a knowledgeable advisor who understands evolving local and cross-border banking expectations.
Diversify Your Corporate Accounts in Singapore to Mitigate Risk
One of the smartest risk management strategies is to maintain at least two active corporate bank accounts. Here’s why this approach is highly recommended.
In case the only corporate bank account of your business gets closed, you may have just 30 days to find a new one. However, it generally takes 6 to 8 weeks to open a new business account in Singapore. This delay could severely disrupt operations, payroll, vendor payments, or customer transactions.
Additionally, a secondary corporate bank account helps you maintain your business continuity. Many digital banking platforms today allow companies to open accounts remotely, providing flexibility and speed, particularly for global operations.
Need Help Managing Global Banking Risks in Singapore?
Global businesses operating in Singapore increasingly turn to specialist advisors like IMC Group to ensure banking compliance and manage risk effectively.
At IMC, we support our clients in:
- Opening and maintaining multi-jurisdictional corporate bank accounts
- Navigating KYC/AML compliance for global operations
- Responding to banking and regulatory inquiries
- Implementing sound governance frameworks
Whether you’re setting up a Singapore entity, restructuring an Investment Holding Company, or preparing for global expansion, we offer tailored banking and regulatory support to keep your operations resilient and compliant.
