Bringing money in and out of Thailand, laws, rules: Updates
Bangkok Post: 5 Apr 2009
YOUR MONEY: Bringing it to Thailand and taking it out, Part II
By: Expat CounselLast time we talked about the mechanics of bringing money into Thailand. This time we'll discuss the bank accounts you can keep it in.
To begin with, in Thailand you can deposit baht or foreign currency in Thai banks. This week we'll concentrate on baht accounts.
Banks in Thailand offer three basic accounts in which to deposit Thai baht, with many small variations. The first is the current account, sometimes known as a chequeing account. It is the most convenient account offered in that it usually comes with lots of options such as use of automatic teller machines (ATMs), credit or debit cards, on-line banking, telephone banking, cheques and bill payment services. The money is safer than under your mattress but just about as readily available.
But you pay for the convenience of having a current account. None of the banks we contacted offers interest on these accounts. Also, they require bigger minimum initial balances than are required on other kinds of accounts, such as savings accounts. Kasikornbank, Siam City Bank and Bank of Ayudhya all, for example, require an initial deposit of at least 10,000 baht. Also, Siam Commercial Bank, Kasikornbank and Siam City Bank all have charges of 100 baht or so a month if your account balance drops below a certain level, usually around 1,000 baht.
Practically all of the big banks offer ATM services with current accounts. Of the banks we checked with, ATM services were free for transfers in and out of the depositor's account at an ATM in the same bank clearing area where the account was opened. After that, there is a fair amount of variation between banks.
Examples of variations between banks for ATM services are that Siam City Bank allows free service for transfers via ATM to other Siam City Bank accounts in the same clearing area but charges different fees for transfers outside the clearing area, both to Siam City Bank accounts and to other banks. Kasikornbank charges a fee of 10 baht for every 10,000 withdrawal across clearing districts. In short, before opening the account you should ask for their list of prices for the services in connection with ATMs, if you plan to use the ATM.
The second kind of account is a savings account. The advantage of these accounts is that they pay a little interest. When we checked, Bangkok Bank, Krung Thai Bank and Siam City Bank were all paying 0.5% per year. And there is a much smaller initial deposit requirement, 500 baht for Bangkok Bank, Bank of Ayudhya and Kasikornbank.
Most of the banks with whom we checked offer ATM services with savings accounts. Also, deposits in savings accounts are often usable as collateral for loans from the same bank.
If you have sizeable transactions on short notice, however, you should check with the bank, because some of these accounts have daily limits for withdrawals. Also, as with current accounts, there are often small penalties for dropping below a minimum balance. For example, Siam City Bank charges 50 baht a month for accounts that have dropped below 500 baht for more than a year.
As you can see from the above, we've done a fair amount of leg work with the banks. We've only discussed a few of the most standard products, however. For example, several of the banks discussed above offer special deposit accounts with higher interest rates but less flexibility. Also, the terms such as interest rates fluctuate all the time. Before opening an account, therefore, you should check with a couple of banks yourself.
Next time we'll talk about the third kind of baht account you can have, and move on to foreign currency accounts.
James Finch of Chavalit Finch and Partners (finch@chavalitfinchlaw.com) and Nilobon Tangprasit of Siam City Law Offices Limited (nilobon@siamcitylaw.com). For more information visit
http://www.chavalitfinchlaw.com. Comments? Questions? Contact us at the email addresses above.
------------------PREVIOUS ARTICLE IN SERIES:
YOUR MONEY: Bringing it to Thailand and taking it out Part I When foreigners come to live in Thailand they bring money to buy homes, invest in businesses and pay their expenses. If they leave, or if they have expenses elsewhere, they may want to send the money out. We are often consulted about various aspects of currency transactions in and out of Thailand. This series covers some of the important things you should know about money flows to help you avoid costly mistakes.
Any amount of foreign currency may be transferred from a foreign country and deposited in a bank in Thailand. If the amount deposited exceeds US$20,000 the Notice of the Competent Officer Rules and Practices regarding Currency Exchange dated March 31, BE 2547 requires this be reported by filing a foreign exchange transaction form with the Bank of Thailand. In practice, when it receives the money, your bank will prepare the form for you and ask you to sign it and submit it for you to the Bank of Thailand. Until you sign the form, your bank won't release the funds to you.
Of course, you can do what we lawyers call "structuring", which means bring in the funds in pieces so that no piece is greater than $20,000 and you don't have to bother with the form. If you do want to structure a transaction you should know two things, however. First, neglecting to fill out the form is a violation of Thai law. You would theoretically be exposed to a fine or imprisonment if the Thai authorities link up your transfers and they exceeded $20,000. Second, because you will be making more than a single transfer, your transaction costs to structure it will be higher than if you declare the funds all at once.
What about physically bringing currency into Thailand? Again, there is no limit, but under Ministerial regulation No. 25 (BE 2550) you have to declare at customs any amount you bring that is more than the equivalent of $20,000. You must then deposit these funds in a bank or convert them to baht at a bank or other licensed financial institution within a maximum of 360 days of when you brought them in or received them from someone who did. The published exceptions to this rule are foreigners in the country for less than three months and foreign missions or international organisations with diplomatic privileges.
For non-resident foreigners, the law allows you to open foreign currency accounts with banks in Thailand. You can also open two types of baht accounts:
Non-resident baht accounts, which are used for services, trade, lending and direct investment in Thailand.
Non-resident baht accounts for securities, which are used to fund and receive money from financial instruments and securities in Thailand.
These activities must be kept separate. You can open more than one of each type of account. The total daily outstanding balances for all of these accounts for any one non-resident individual, however, can't exceed 300 million baht.
The documentation for opening accounts is different among the banks, so you should check with the bank with which you are considering opening an account. As a general proposition residents have to provide the bank with passports and work permits, residence permits or certificates of residence. For non-residents, in lieu of work permits, residence permits or certificates of residence, the banks generally require a letter of recommendation from something like one of the following:
A person acceptable to the bank and certified copies of that person's identification or an embassy or international organisation or your bank abroad, sent by Swift.
Opening accounts for foreigners, especially non-residents, is very much a matter of discretion with the banks, so don't be surprised if they are picky with your recommendations or won't do it at all. They are responsible to the Bank of Thailand to screen out money laundering and may face punishment if they are not effective in doing this.
In addition to the transactions mentioned above involving $20,000 or more, if you are selling, withdrawing, depositing or purchasing foreign currency in the amount of $20,000 or more for any transaction you will have to fill out a foreign exchange transaction form. The form, by the way, is a one-pager giving information about the person executing the transaction, the person receiving the funds, the account and the payment method. If a loan is involved, the basic information about it must be included. The person executing the transaction and the bank must sign it.
Next time we'll explain and compare the requirements and rates of Thai banks for depositing funds.
James Finch of Chavalit Finch and Partners (finch@chavalitfinchlaw.com) and Nilobon Tangprasit of Siam City Law Offices Ltd (nilobon@siamcitylaw.com)
For more information visit http://www.chavalitfinchlaw.com.
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