While not considered a tax haven by any means, Armenia is often regarded as the “Switzerland” of the Caucuses thanks to its business-friendly policies, macroeconomic stability, and strict bank secrecy laws. Despite being a developing country, Armenia has long been one of the most stable countries in the region with a well-developed financial sector. 

With that said, Armenia is welcoming of foreigners and in most cases (for individuals) all you need is a passport and a completed application. The bank fees for non-residents are usually the same as those in European banks, like Cyprus. Many banks will allow a third party to submit the application under a Power of Attorney (POA). 

Benefits of Banking in Armenia

-Stability: Armenia has been one of the fastest growing and most stable economies in Europe thanks to its business-friendly and prudent macroeconomic policies. The financial sector is well-developed, regulated, and has not experienced any major crisis in recent times. The diversified economy of the country and decreasing dependence on Russia as a key destination for Armenia’s exports start brining definite business advantages.

Armenia and the European Union are guided in their relations by the Comprehensive and Enhanced Partnership Agreement between the EU and Armenia (CEPA). It was signed on November 24, 2017 and entered into force on March 1, 2021. The document lays the foundation for mutually beneficial cooperation in various areas: strengthening democracy, human rights and the rule of law, creating new jobs and business opportunities, adopting fair legislation, enhancing safety and security, improving the environment, improving the quality of education and increasing opportunities for research.

-Variety: the banking sector is well-represented with a mix of foreign and domestic firms. The prominent fact proving the reliability of the Armenian banking sector is that for the whole history none of the banks was deprived of its license.

-Strict Bank Secrecy Laws: it is a crime to release bank account information without a court order. Armenian banks are not subject to CRS requirements although you may be required to report foreign bank accounts per your home country’s laws. 

-Deposits: Many banks accept foreign currency deposits such as USD, EUR, RUR, JPY, GBP, to name a few. Not to mention, offer time deposits (usually in USD, RUR) although availability (and acceptance) of foreign currency will vary by bank. 

-Remote opening: a person can open an account in an Armenian bank without coming to the office, totally remotely. The interviews with the bank representatives are held via such platforms as Zoom.

Ask for more information

Banking Services

Aside from accepting deposits in a number of foreign currencies, Armenian banks offer the same services you would expect from a bank in any western country. As such, they offer a wide range of options for international clients. All banks offer deposit insurance backed by the Central Bank in the following amounts: up to 16 million AMD (appx. $33,000) for AMD deposits and up to 7 million AMD (appx. $14,000) for foreign currency deposits. 

These are the typical services you can expect from an Armenian bank:

-Online banking: you can manage your account, make payments, and transfer money from anywhere in the world. 

-For businesses: there are payment services (including online) that are available and usually provided by banks at the European standard rates. Visa and MasterCard are widely accepted throughout the country. 

-International transfers and remittances can be done following all the international requirements regarding KYC, AML, etc.

-Bank deposit boxes can be obtained for a minimal fee, as low as 30,000 AMD (appx. $15) a year for a small box in some banks. This is an ideal option for safeguarding valuables such as expensive jewelry and certificates.

-The private banking is currently under development, so the main purpose is making bank transfers and payments. 

Investing

The Armenian banks work together with professional brokers and investment companies and some of them do bring good returns. This is an attractive option for individuals that are looking for a secure, interest-paying investment. 

The banks can open brokerage accounts and the clients make buy investment products through brokers that open access to both local stock exchanges like Armenia Securities Exchange and international ones, like NASDAQ. 

Many banks offer time deposits in several currencies such as the USD, and RUR. However, local currency (AMD) deposits have better returns and as of June 2021, the rates are as high as 10% for a one-year deposit. In comparison, a USD deposit from the same bank pays 2.5%.

Also keep in mind interest income is taxed at 10%.

How to Open a Bank Account?

For an individual account, it is simple and straightforward, not with too many documents involved. However, keep in mind there are general international guidelines as each bank may have their own requirements. You may also be asked the reason for opening an account and the source of the funds. 

Required documents:

-For foreigners that do not reside in Armenia (or do not have residency): You will usually just need your passport and signed application, a proof of address, CV, source of funds. All documents should be presented in the copies of the originals certified by apostil. The process can be completed in person, remotely or by a third party under a power of attorney. It can take as little as 30 minutes or a few days if further checks or verifications are needed.

-Corporate accounts: opening a corporate account is straightforward although you will be required to submit some extra documents, namely copies of passports for the director and all shareholders along with the corporate registration documents. All the compliance, AML, KYC requirements are strictly followed by the Armenian banks.

Like individual bank accounts, it can be done through a third party. Also keep in mind many banks may not permit you to open an account if the company does not have a physical presence in the country. 

As noted earlier, Armenian banks are not subject to CRS although they must comply with FATCA requirements. In addition, you may be required to fill out additional forms and report the bank account information to your home country. 

Lastly, all the banks in Armenia don’t do business with nationals (or entities) from countries that are under international sanctions such as Syria or Iran. If the above situations apply, it is advised to contact the bank or consult with a lawyer prior to opening an account.

Fees

One might think that opening (or maintaining) a bank account in Armenia is costly. On the contrary, there are minimal fees with low deposit requirements. Monthly maintenance fees are usually no more than 12,500 AMD (appx. $25). In addition, for current accounts you will be issued a Visa or MasterCard that can be used just about anywhere in the world. 

Why Opening a Bank Account in Armenia?

There are several reasons why one may be interested in opening a bank account in Armenia. 

Armenia offers security for your assets and many banks accept deposits in foreign currency. Not to mention, they pay decent interest rates, albeit not as high for AMD deposits. Opening an account is a simple and painless procedure and can be done through a third party. It does not get much easier than that, and Armenian banks offer all of the amenities and services you would expect from a bank in a developed country.

Perhaps the biggest advantage of banking in Armenia are the strict secrecy laws. It is a crime to reveal a client’s bank information without an Armenian court order. Likewise, it does not have a negative reputation as an offshore banking center like some countries. That is not to say Armenia is the “Wild West” and there are no rules. There are laws pertaining to money laundering and you will often need to provide proof of where the funds came from.

Corporate accounts will typically receive more scrutiny if they do not have a physical presence in the country. Lastly, Armenia is not subject to CRS requirements although that does not exclude foreign nationals from their home country’s reporting laws if applicable. 

When it comes to asset protection and wealth management, Armenia is an ideal “plan B” for individuals and corporate entities. With a stable, well-developed banking sector and strict privacy laws there is a reason why Armenia is regarded as the “Switzerland” of the Caucuses. 

Are you interested in opening an Armenian banking account? If so, we offer a full range of services and can assist you with opening your account. 

Contact MUNDO for a free and no-obligation consultation and we’ll introduce you to one of Armenia’s top banks which has a permit to work with non-residents. 

Contact us