Complete Guide to Opening a Business Bank Account in RAK: Offshore & Mainland

Ras Al Khaimah, or RAK, is a top spot for business in the UAE. It has free zones and low costs that draw investors from around the world. This guide will advise you on how to set up a business bank account in RAK for Offshore or Mainland companies. 

Offshore companies hold assets and trade outside the UAE, get set up quickly and have 100% foreign ownership. Mainland companies will trade within the UAE and with customers, which adds complexity to the setup. 

A business bank account will keep the company’s funds safe and separated from the owner’s personal funds. It will benefit the business in terms of tax payments, obtaining business visas, and helping orderly company growth. RAK banks like RAKBANK have good and fast services and have many digital tools that will suit your needs.

Why RAK 

• Prime Location: RAK is located between Dubai and Oman and has good access to ports. Ships bring goods fast, and roads link to big markets. This spot cuts travel time and costs for traders.​
• Free Zone Benefits: RAK FTZ offers 100% foreign ownership. You do not need a local UAE partner for offshore arrangements. Mainland will cover the entire UAE market. 
• Low Tax: Personal income tax is zero, and corporate tax for most of the firms is 9% starting in 2023. 

Finding a bank and opening an account is made easier due to top banks such as RAKBANK and Emirates NBD having mobile applications to create an account in under a week. If you want to do multicurrency transfers, consider opening an account with RAKBANK or Emirates NBD.  

What are the advantages of opening an account with RAK?  

Online applications for banks such as RAKBANK are simple and quick. You can fill out the application from the comfort of your own home and submit the necessary documentation in just a few minutes, while only being required to upload one document at a time.

• Zero Balance Options

RAKstarter account starts with no minimum for new firms. Startups under one year avoid fees. Ideal for offshore or small mainland setups.​

• Multicurrency Support

Hold AED, USD, and EUR in one account. Offshore traders send money worldwide fast. Low fees on transfers cut costs for imports.​

• Overdraft and Loan Access

Current accounts give overdrafts up to AED 500,000. Link to SME loans for growth. For fast approval, banks verify licenses and turnover.  

• Digital Tools Available 24/7  

Apps monitor your balance, pay bills, and issue cheques. Real-time notifications detect and alert users to fraudulent activity. Sharia accounts are interest-free to comply with Islamic laws.  

Offshore vs Mainland: Main Differences  

• Ownership Rules: It is foriegnly 100% owned with no local sponsor for the offshore. For the mainland, it usually requires a local partner, 51%. Recent, though, allows full ownership for many cases.  
• Trading Scope: Offshore is limited to international business, with no local sales in the UAE. On the mainland, there’s full access to the UAE market, and with government contracts as well.  
• License Source: Offshore gets an RAK ICC certificate. On the mainland, it’s a RAK DED trade license or one from a free zone.  
• Office Needs: Offshore doesn’t require a physical office in the UAE. In the mainland, a tenancy contract and proof of Ejari are necessary.  
• Tax Setup: Offshore, 0% on foreign income. Mainland, since 2023, there’s a 9% corporate tax.  
• Best Fit: Offshore is best for holding companies and asset protection. For retail, services, and local trade, the mainland is best.

Types of Business Bank Accounts in RAK

Current Accounts

Current accounts manage day-to-day business expenses such as payments, checks, and transfers. They usually provide overdraft facilities. Mainland trading companies use these accounts the most, and for small cash needs, they are high-turnover accounts. They charge small monthly fees, and there is a minimum balance requirement of around AED 10,000.

Savings Accounts

Saving accounts are interest-earning accounts with restrictions on withdrawals. Offshore companies use these accounts for the safe building of reserve cash, where they can earn interest in a secure manner. Interest is paid annually at rates of 1% – 2% depending on the account balance. You are free to access the account and withdraw cash, but there are limits on the number of transfers you can make.

Fixed Deposit Accounts

A fixed deposit account is for the placement of funds for a fixed period of time, ranging from 3 months to 5 years. Funds attract interest at higher rates depending on the length of the period. Rates are currently as high as 4%. They’re ideal for both offshore and mainland companies looking to grow their funds. Early withdrawal cuts interest earned.

Trade Finance Accounts

Trade finance supports imports with letters of credit and guarantees. Mainland exporters get fast approvals from banks like RAKBANK. Covers supply chains and reduces risks on big deals. Fees are tied to transaction size.

RAK Bank Business Account Types

• RAKstarter Account

New businesses and startups get this zero-balance option. No minimum funds needed for the first year. Multicurrencies like AED, USD, and EUR work for offshore trade. A free chequebook helps with daily payments.​

• Business Current Account

SMEs use this for daily transactions and cheques. Keep an AED 25,000 average balance or pay an AED 50 fee. Overdrafts and digital apps speed up work. Upgrade to SME packages for more perks.​

• Business Call Account

Earn interest on funds with easy access. Minimum AED 25,000 for rates up to 0.25%. Suits offshore holdings needing flexibility. Open to non-residents with a trade license.​

• Business Elite Account

Premium choice for established firms. High limits on withdrawals and transfers. Dedicated support and lifestyle perks come standard. Multicurrency fits global mainland trade.​

• Commercial Elite Account

Large enterprises pick this for full services. Preferential rates and exclusive tools. Covers trade finance and loans up to AED 3 million. Best for high-turnover RAK operations.​

Eligibility Requirements for RAK Offshore Company Bank Account

Age Limit

Signers must be 18+ years old for standard accounts. Elite accounts like Business Elite require 21+ years. This regulation protects safe decision-making and complies with UAE banking regulations. 

Legitimate Trade License

All companies must possess a valid UAE or RAK trade license. The license should correlate with your specific business activities, such as trading or consulting. Banks verify this first for compliance. 

Business Incorporation

Submit your Certificate of Incorporation and commercial register extract. These documents confirm your business is legally registered with RAK DED, a free zone, or ICC. Lack of documents can cause delays in obtaining approvals. 

Minimum Balance Requirement

RAKstarter gives AED 0 for new, jerky startups operating for less than a year. For Current Accounts, an AED 25,000 monthly average or an AED 50 monthly fee is required. For Elite, AED 500,000 is required; otherwise, an AED 250 monthly fee applies. 

Good Standing

No owners are to have sanctions or bad lists. If there, they are to be declared PEPs. Having good financial standing and clean bank statements would accelerate KYC processes. 

Business Presence 

Mainland companies must provide office proof with an Ejari tenancy contract. Offshore RAK ICC does not require this, but registered agent details are needed. Banks verify the address for real operations.​

Residency Status

UAE residents, GCC nationals, and non-residents all qualify. Provide passports, visas, Emirates ID, and address proof for signers. Non-residents face extra source-of-funds checks.​

Authorized Signers

List all signers with passports, Emirates ID, visas, and utility bills. They sign board resolutions for account use. Multiple signers need joint approval rules.​

For SMEs and Startups

Zero-balance RAKstarter fits new firms. Submit a business plan and projected turnover if under 12 months old. Banks favour active RAK licenses for a quick yes.​

For Offshore (RAK ICC)

Add proof of fund sources and registered agent papers. No local trading proof needed. Banks like HSBC review global activity for faster offshore setups.

Documents Required

Offshore Companies

• RAK ICC Certificate of Incorporation.​
• Memorandum of Association (MOA).
• Passports and CVs of shareholders/directors.
• Proof of address (utility bill or bank statement).
• Board resolution authorising RAK business bank account opening UAE.

Mainland Companies

• RAK DED or free zone Trade License.​
• MOA/Articles of Association (AOA).
• Emirates ID and residency visas for owners.
• Tenancy contract with Ejari stamp.
• Company resolution and audited financials (if established).

Shared Documents for Both

• KYC (Know Your Customer) forms & passport photocopies.
• Optional but recommended, include reference letters from prior banks.
• Proof of minimum deposit (currently the amount varies from AED 10,000 – 50,000).
• Recent 6 months’ bank statements & updated pictures of yourself.

Step-by-Step Process of Opening Your Bank Account

Step 1: Expert Consultation and Bank Selection

Professional services firms and consultancy companies such as Commitbiz can help ease the process. For certain banks, like RAKBANK for mainland and HSBC for offshore, determine which one serves your needs the most. They assess your business and provide suitable account options.

Step 2: Assemble the Necessary Documents

We will need specific documents for your KYC, like the trade license, MOA, passports, & proof of address. For offshore, there are fewer documents, and for mainland, you have to include the visas & Ejari. The bank statements and KYC forms also have to be set aside.

Step 3: Submit Online Applications or Visit the Bank

To fill in the forms online, visit the bank’s RAKBANK Quick Apply webpage. You can also visit the bank and hand in the documents. Fill in the sections that ask for the company details, shareholders, as well as expected turnover.

Step 4: KYC verification process

The process takes around 2-7 business days as banks verify the documents. They might reach out for further clarification or perform background checks. Offshore accounts are processed quicker, and local visas are not needed. 

Step 5: Sign Agreements and Activate

If approved, a bank representative will meet with you to sign the account documents. You will be required to fund the account to meet the minimum balance (starting from AED 10,000+). Instantly, you will receive your debit cards, cheques, and online banking.

Most Commonly Used Banks in Ras Al Khaimah

Bank of Ras Al Khaimah (RAK Bank)

RAK Bank is in first place when it comes to local services and has multiple branches throughout RAK. RAK Bank has relatively simple and fast RAK business bank account opening procedures and is able to lend to SMEs. RAK Bank’s mobile applications make daily banking for merchants easy and convenient.

Emirates NBD Bank

Emirates NBD Bank is very suitable to handle offshore, multicurrency and is known for International trade finance and rapid International interbank transactions. Emirates NBD Bank has a high presence in many parts of the UAE and, as a result, can help to speed up the transaction processing for firms in RAK.

Mashreq Bank

Mashreq Bank is particularly strong in export trade services that involve issuing and managing letters of credit, making it a good fit for exporters in the mainland UAE and trade partners in RAK with a high level of business interactivity. They have a low lending service fee and rapid processing for loans.

Commercial Bank of Dubai (CBD)

CBD has a strong and flexible corporate account offering with the ability to have an overdraft, which is good for offshore clients as well as clients who trade locally. The ability to manage your account through the Internet is a strong service.

HSBC UAE

HSBC has a focus on offshore banking services when it comes to the UAE, as well as having a global network, which is beneficial to foreign investors who need to make cross-border payments. They have high minimum balances and, as a result, provide more premium banking services than usual.​

Detailed Costs Breakdown and Timeline

Account Opening

Opening accounts costs banks between 500 and 2,000 AED.  RAKBANK adds 250 AED for expediting services. Some advisors like PRO firms charge an additional 1,000-3,700 AED for non-residents. High-risk business accounts incur additional fees for excessive due diligence, costing an additional 7,500 AED. 

Account Maintenance

If the account balance is less than 25,000 AED, current accounts incur maintenance fees of 50-104 AED per month. RAKstarter charges nothing for the first month, then 25 AED for each subsequent transaction.  SME package maintenance fees range from 350-1,500 AED based on the cash requirements. 

Minimum Mandatory Account Balances

RAKstarter accounts require no initial deposit. The current spending accounts require an average balance of 25,000 AED each month. The elite tiers require an average monthly balance of 500,000 AED and will incur additional maintenance fees if the balance requirements are not maintained. Offshore spending accounts typically require an initial deposit of 10,000 AED.

Account Approvals

Low-risk accounts are processed on a first-come, first-served basis and typically take 2-3 weeks. Offshore accounts are processed on a clean paper basis and typically take 2-7 days. Complex accounts can take 4-6 weeks for KYC calls and background checks.

License Renewal & Additional Costs

The annual license renewal fee is a legal bank requirement that costs between 6,000 and 12,000 AED. With respect to cash management, you can avail yourself of a fee of 0.25% on additional payments. 25 AED is the basic charge for the initial setup of couriered checks. To reduce verification time, please use DUL.  

Reasons for not opening business bank account in RAK  

Insufficient documentation  

Not having sufficient documentation will cause delays, and this includes all requested documents such as passports, trade licenses, MOAs, and Ejari.

High-Risk Business Activities  

Startups (especially new ones), consultants, and crypto-based businesses will often face delays and higher scrutiny due to AML (Anti-Money Laundering) regulations.  

Problematic Owner Documents  

It is essential to have a clean history, as owners on sanction lists, PEPs (Politically Exposed Persons), and record blocks will fail KYC (Know Your Customer) regulations.  

Low Minimum Balance  

Accounts require an average balance of AED 25,000. If the balance is low, fees may be incurred, or the account may be closed.  

New Company Without Background  

Banks require companies to be in business for a minimum of 12 months and provide company statements to demonstrate that there is productive activity.  

Company’s Internal Policies  

RAKBANK does not have local ties with the countries that are considered higher risk. The length of this thread exceeds the limit. Please initiate a new thread to continue.

For more help, contact the professionals from Company formation in Dubai. They are licensed business setup consultant in Dubai with over 12+ years of experience. 

Frequently Asked Questions About Business Bank Account in RAK 

Q1: Can Non-residents Open Offshore Accounts Without a UAE Visa?  

Yes, RAK ICC offshore firms qualify with just the passport and agent proof, and no residency visa is required, unlike the mainland.  

Q2: Does RAKstarter allow a zero balance for more than 1 year?  

If you have a startup under a year, you can have a zero balance, but you will have to switch to Current at some time and have an average balance of AED 25,000 or pay fees.  

Q3: Why are there more checks for Crypto or consulting companies?  

These sectors come under greater scrutiny due to their risk, and concerning their UBO, you should have at least, passport and proof of funds.  

Q4: Why does Ejari matter for Offshore Vs. Mainland approval?  

For the mainland, getting Ejari proof of lease is a must, but for offshore, you can skip that entirely and just include registered agent information for us to verify.  

Q5: Do elite accounts get to skip the AED 500,000 balance with a turnover?

High monthly turnover (AED 1M+) or SME loans may reduce the fees, but the base minimum will remain. This is for the premium perks.

Conclusion

RAK makes business banking easy for offshore and mainland companies. Choose accounts like RAKstarter for startups or Elite for big operations. Gather the docs right and use PRO services to avoid delays.​

Digital apps, multicurrency support, and loans help your firm grow fast. RAKBANK suits locals while HSBC fits global trade. Start today to keep funds safe and follow UAE rules.

Contact the experts from Company Formation in Dubai for more help!