What you need to open a business bank account in South Africa

Ever been stuck with a business bank account after successfully registering a business? You are not alone, many business owners are faced with the same situation in South Africa. To get help, they often go to third-party service providers to open a bank account. But not all business owners can afford to hire a third person to open a business bank account for them.

Why not cut the middleman? Yes, you can open a business bank account for yourself. It doesn’t matter the type of business you operate. Whether you are a partnership, close corporation, sole proprietor, or a registered company you can open a bank account with one of the big 5 banks in South Africa. 

You just need to get a few things right before applying for a business bank account. First of all, the type of entity matters when opening a business account. In fact, different types of companies have different requirements when opening a business bank account. 

We will introduce you to some of the platforms that you can use to open business bank accounts and the requirements for each entity to open a business account. If you got everything in order, you can open a business account in minutes. 

How to open a business account in South Africa

Different businesses have different requirements for business bank account opening purposes. We will look at different types of entities in this chapter and discuss the requirements to open a bank account for each type of entity. 

Sole Proprietors

A sole proprietorship is a form of business organization that has a single owner. This owner has the total responsibility of the business. The owner is liable for the business, therefore, you cannot separate the owner from the business. 

Sole proprietors pay provisional tax and are not legal entities. However, they are recognized in South Africa as a form of business. For this reason, a sole trader can open a personal account and use it for business since the owner and the business cannot be separated.

Sole proprietor bank account requirements:

• Copy of your South African ID or passport, and
• Proof of residence that is not older than 3 months at the time of application.

Partnerships

Partnerships still exist in South Africa. According to the Companies Act 71 of 2008, partnerships will be given time to be turned into companies. However, there is no specified period of the change but the Minister may announce the cutoff date at any time. 

A partnership is an agreement between two or more parties to form an organization. Profit and loss are shared according to ownership. 

To open a bank account for a partnership in South Africa, you need the following:

• ID copies or passport copies of all partners,
• Mandate to open a bank account (if not all partners will be present to open the bank account),
• Partnership agreement stating the profit or loss sharing amongst partners, and
• Proof of residence that is not older than 3 months at the time of application or proof of business address.

Close Corporations

Close corporations are member-owned registered businesses that operate under the companies act no 71 of 2008 as amended. Like partnerships, close corporations are given limited time to turn into companies as per the companies act. This is because many close corporations make more money than registered companies and members are not fully involved in the running of the business. 

Close corporations must have at least 1 member but not more than 10 members. 

Close corporation business bank account opening requirements:

• CKI or CIPRO certificate,
• ID copies or passport copies of all members of the close corporation,
• Mandate to open a business account (if there is more than 1 member and/or if other members are not present when opening an account.), and
• Company proof of address that is not older than 3 months. (utility bill or sworn Affidavit)

Private Company

Private companies have been popular since CIPC has made them easy to register. To open a bank account for a private company is easy and with one director the process becomes even shorter. A private company must at least have 1 incorporator and 1 director but must not have more than 50 directors. 

Private company bank account opening requirements:

• ID copies or passport copies of all directors of the company,
• Registration certificate or Cor14.3 document,
• Mandate to open a bank account (if there is more than 1 director or/and if other directors are not present when opening the business account), and
• Company proof of residence that is not older than 3 months at the time of application.

Non-Profit Company

Non-profit companies are companies that are set up to help people, protect the environment, or lobby for a good cause. These are registered entities and must register for income tax as well. The entity must have at least 3 directors. 

Non-profit company bank account opening requirements:

• Certified ID copies or passport copies of all directors,
• Registration certificate or Cor14.3 document,
• Constitution of the company,
• All directors must be present when opening the bank account, and
• Proof of business address that is not older than 3 months at the time of application.

Platforms to use to open a business bank account

Now that you know which paperwork to have and which directors to bring when opening a business bank account, you now need to use a certain platform to start your application. You can make use of one of the following platforms to open a business bank account. 

Online Application

You can make an online application for a business account. All you need to do is to go to your bank of choice’s web address or use their mobile app to start the application. Online application is much faster and a business bank account can be opened in a few minutes or hours. 

Fill the application documents online and print out and sign any documents sent to you and send them back immediately. Documents that need to be signed will be sent to your email. You will be required to send supporting documents that are relevant to your business bank account application. 

BizPortal

BizPortal is a platform developed by CIPC and offers a number of services t with one of them being for business account opening. You can open an account with BizPortal by simply registering with the services provider. BizPortal offers customers the opportunity to open a business bank account(s) with Absa, FNB, Capitec Bank, Nedbank, and Standard Bank at no additional cost. 

Branch

You can visit a local bank branch to apply for a business account. Make sure that the branch that you visit offers business account opening services because not all branches offer business support services. 

Conclusion

Opening a business bank account in South Africa should not cost you a single cent. You can make use of different platforms to open a business bank account as long as you have the correct information and documents in order.