Can foreigners open a bank account in Australia?

If you’re migrating to Australia, taking a working holiday, or studying as a student, you should be able to open an Australian bank account.

Opening a bank account in Australia is a relatively simple process. You can start by comparing the different types of bank accounts foreigners can open in Australia. Once you’ve found a bank account that suits your needs, you can start the application process.

Can anyone open a bank account in Australia?

If your banking activities aren’t breaking any domestic or international laws, most individuals can legitimately open and maintain an Australian bank account as a non-resident.

Just as Australians have offshore bank accounts for a variety of reasons, foreigners may decide to open an Australian bank account, whether living in Australia or elsewhere as a non-resident.

Reasons may include: 

• running a business in Australia;
• expanding investment and banking portfolios, and;
• spending significant amounts of time in Australia.

If you are moving to Australia for work purposes, it’s commonplace to open a local bank account so you can receive income and pay/claim tax.

There can be legal tax benefits in holding your money in an Australian bank account as a non-resident, but it may be sensible to first consult a financial advisor that’s skilled in international banking law.

It may be possible to get by without a bank account in Australia by making only cash transactions and keeping your wealth as physical assets, such as banknotes or jewellery. However, finance in Australia and around the world has become increasingly digital, making a bank account more of a necessity to conduct many types of transactions.

This can include: 

• preparing a direct debit for an ongoing expense;
• paying bills and debts, or;
• transferring money via internet banking.
• How to open a bank account in Australia

Depending on the financial institution and type of account you choose, you may be able to apply for an Australian bank account online or over the phone before you arrive in Australia.

Your ability to open a bank account in another country will depend on a range of factors specific to the intended financial institution and country. It may be easier in some places than others.

Opening a bank account in Australia is often similar to opening an account in your home country. You’ll typically need to provide personal information that confirms your:

• name;
• date of birth;
• residency address;
• citizenship status, and;
• occupation. 

These details will need to be verified by the financial institution with whom you’re applying for an account. You’ll need to have copies of original documents that you can scan and send, or post. Additionally, there may be extra layers of security, credentials or information (e.g. notarised documents, bills, payslips, bank statements) required to positively prove your identity.

You’ll want to conduct plenty of research before you decide to open any bank account, whether you’re looking for the best bank account for an expat or a bank account for travel. As well as looking at the rates, fees, features and benefits offered by different banks, you may also want to consider the following checklist before opening an Australian bank account:

• Investigate the legal requirements for opening a bank account in Australia
• Check the financial institution’s website for application details and information pertaining to foreigners
• Have all your documentation and relevant information handy before applying for an account
• Find out the interest rates, fees, accessibility and rules for foreign account holders
• Decide on the type of account - an everyday account, savings account or term deposit

Remember that any money you deposit with an Authorised Deposit-taking Institution (ADI) in Australia will be automatically guaranteed by the government’s Financial Claims Scheme (FCS), up to $250,000 per person per ADI. So, in the unlikely event that your bank went out of business, you can be confident you’ll still be able to access the money from your Australian bank account.

Who offers bank accounts in Australia?

The four biggest banks in Australia are: 

• ANZ
• Commonwealth Bank
• NAB
• Westpac

Some international banks and their affiliates, such as HSBC, Arab Bank, and ING, also operate in Australia, which could be convenient for selected customers. 

But don’t feel you’re limited to just the big four banks or an international bank. It’s important to compare bank accounts from a wide variety of different ADIs to find one that suits your needs as a visitor or new arrival to Australia. 

What are the different types of Australian bank accounts?

Bank accounts

Bank accounts, also known as transaction accounts, are intended for everyday use. When you’re paid by your employers or clients, the money will likely be deposited into your transaction account. 

When you use a debit card to withdraw cash from an ATM or make a contactless (tap and go) debit card purchase, the money will likely come out of your bank account by default.

Most bank accounts offer convenient access to your money, whether through online banking, ATMs, or by withdrawing cash from a bank branch. Some bank accounts may also offer extra features such as access to smart payment systems like Apple Pay, Samsung Pay or Google Pay, or mobile apps to help users with their budgeting and mobile banking.

Savings accounts

A savings account is a bank account that’s been optimised for saving money. Savings accounts let you earn interest on the money you deposit - the more money you hold in a savings account, and the longer you can leave it there, the more you may be able to grow your wealth.

While your everyday bank account may sometimes be called a savings account - such as when you’re choosing between cheque, savings or credit accounts on an EFTPOS machine - it may not be the best available option for saving money. It’s certainly possible to save money in your everyday bank account by diligently making regular deposits and minimising withdrawals, however, most regular bank accounts don’t pay interest on your savings.

Term Deposits

A term deposit functions almost like a cross between a savings account and an investment. In this arrangement, you agree to deposit a sum of money with a bank or similar ADI for a specific length of time (or ‘term’), over which you will earn interest on your savings.

Term deposit accounts earn interest at fixed rates, so you can often calculate in advance just how much interest you can earn. They’re often much less risky than investing your savings in other assets, such as shares.

Transacting with an Australian bank account

You can generally use international money transfers to send funds from your foreign bank account/s to your Australian bank account, but it’s important to check with the financial institution from where you’ll be sending funds to ensure they can process your payment. There are often additional fees and currency exchange rates attached to these types of transfers, compared to regular domestic fund transfers. You may want to consider these costs and how they might differ bank to bank.

Once you’ve arrived in Australia, you’ll be subject to domestic banking rules and regulations. Most transactions in Australia are fee-free, depending on your financial institution. However, there are sometimes credit card fees, processing charges and surcharges to be wary of when making purchases. 

Don’t forget to examine your tax obligations, both in Australia and abroad, when it comes to any interest you earn.

Smart use of different banking products, from everyday bank accounts to savings accounts and term deposits, may allow you to gradually increase your bank balance over time, and help you better reach your financial goals.

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