Denmark is one of the countries with the safest banking systems in the world and the banking fees have a tendency to be quite low. After opening a company in this country
, an entrepreneur also has to open a bank account in Denmark.
Since the financial services are important to any organization, for a new company, choosing the right bank is an important issue.
The banking environment in Denmark
When you open a Danish company
, choosing the right bank is of outmost importance. Therefore, a certain knowledge of the banking environment in Denmark is crucial for doing business in this country.
Denmark has one of the safest banking systems in Europe and local banks apply some of the lowest costs associated to opening bank account, administration, withdrawal fees. These low fees are available for those opening personal or corporate bank accounts in Denmark. Since we mentioned these types of bank accounts, it should be noted that individuals can also open savings or deposit bank accounts, while Danish companies can set up merchant accounts in this country.
The merchant account is important to companies that offer e-commerce services because it allows them to accept credit and debit card payments. This is an account that can be arranged for later after the steps for company formation in Denmark have been handled and the share capital is deposited in the regular corporate bank account. The merchant account will be established with the help of a business partner who will facilitate the communications in the electronic payment transactions. Investors should keep in mind that additional fees will apply, however, the benefits of accepting electronic payments will outweigh the costs.
If you want to open a bank account in Denmark, our company formation agents are ready to provide you with ongoing assistance. In some cases, it is possible to open the company bank account through a company representative, an individual who is empowered through a power of attorney to handle this step. This can be useful when company funders cannot be present in Denmark during the entire incorporation process. If this is the case, one of our agents can provide the needed assistance.
Types of banks in Denmark
The banking sector in Denmark is heavily focused on only several major market players. The two largest banks in the country own a combined market share of approximately 70% or even more.
Foreign banks in Denmark target mainly larger corporations and multinationals, even though in the last years some of them have changed this strategy and now also offer personal loans. Our company registration executives in Denmark
can offer more information on this subject and can help you open a bank account in Denmark.
According to the financial supervisory body in Denmark, which regulates the financial markets in this country
, the banks in Denmark are categorized as follows:
• Group 1 banks: with a working capital of at least DKK 65 billion;
• Group 2 banks: with a working capital of minimum DKK 12 billion;
• Group 3 banks: with a working capital of at least DKK 500 million;
• Group 4 banks: with a working capital of maximum DKK 500 million. Our Danish company formation professionals can provide more information on this type of banks;
• Group 5 banks: branches of foreign banks in the country;
• Group 6: these are banks based on the Faroe Islands.
Documents needed to open a bank account in Denmark
Opening a bank account in Denmark is quite a straightforward procedure which generally involves no costs. First of all, one must obtain a residence permit and to create a NemID (a digital signature) which will allow the user to submit various documents online with the authorities. The NemID is useful when opening a company in Denmark, as well as a bank account.
For corporate bank accounts, the company representatives will be asked to provide relevant documents on the company, such as the Articles of Association as well as the identification documents of the company’s director or administrator. The minimum share capital is deposited after the account is formed, the same day. As per the rules set forth by the Ministry of Foreign Affairs
, non-residents are entitled to the same rights to open a business and will need to observe the same costs. After a foreign investor has opened the bank account, the minimum share capital he will have to deposit for a private limited liability company will be of 40,000 DKK or approximately 5,363 EUR. One of our agents can provide you with more details about the capital if you wish to open a company in Denmark
For individuals, the documents necessary to open a standard bank account in Denmark are the following:
- • A photo ID, like a valid passport;
- • A CPR (the ten digit unique number of identification which is issued for all Danish residents) number;
- • Proof of address in the country;
- • An employment contract, if the person in question is working in Denmark.
Cross-border employees who open a bank account with a Danish bank (for the purpose of receiving their salary from the Danish employer) can be asked to present proof of address irrespective if it is in the country or not. The requirements for documentation can also differ from one bank to another.
Having a designated bank account, the NemKonto, is also mandatory. This is also a regular bank account that is used for a specific purpose, that of receiving payments from the Danish public authorities, such as pensions or family allowances. Some companies will also need this account in order to receive an income or tax rebate. Our agents can provide more information once the company registration in Denmark is complete.
Choosing a Danish bank
There are many foreign bank branches in Denmark and foreign nationals who relocate here may choose to work with a bank with which they have had previous experience. Many banks, both domestic and international ones, offer a variety of services that also include comprehensive online services and mobile banking solutions.
Some of the criteria that one may take into consideration when opening a bank account in Denmark include the following:
Minimum deposit: some banks will ask their clients for a minimum deposit; it is worth checking if your chosen bank imposes such costs;
Fees: the overall bank fees can be important for customers; these can include those for ATM withdrawals, intra-bank transfers, etc.; other policies and fees such as for international money transfers, should also be considered;
General services: these can include the issuance of a credit or debit card, loans, internet and mobile banking; most banks offer many services, however, it is useful to check the ones you will need most before opening the bank account;
ATM: customers may also be interested in the range of ATMs a specific bank has in the country.
Below, our team of Danish company formation agents lists some of the most important banks in the country:
- Danske Bank: one of the largest banks where customers can open a variety of accounts and have access to other services such as mortgage or personal loans;
- Nykredit: its main activities are banking and mortgage lending, with 777 billion DKK assets under administration in March 2020;
- Jyske Bank: offering basic accounts as well as separate salary and budget accounts, savings solutions as well as a range of other services for individuals and companies;
- Sydbank: private banking and investor services, loans and pensions as well as other services.
Before you decide on a bank with which you will work with, you can request more information about specific services as well as schedule a meeting with an advisor. Not all banks have English versions of their websites, however, Danes are fluent English speakers and calling the bank for more information or scheduling a meeting can be helpful. Alternatively, foreign clients can reach out to our agents for detailed information as well as assistance.
If you need to know more about the banking system in Denmark, or require assistance to open a company in this country, we invite you to get in touch
with our Danish company formation representatives. They will help you open a bank account in Denmark and will assist you in all aspects related to investing in Denmark
. In case you would like to open a bank account
in another country, for example in Panama, we can put you in contact with our partners.