These are a few frequently asked question over the years of client service, mostly regarding initial set-up, business license, and invoicing..

Bank Account Matters

As part of the initial business set-up process process, opening a bank account is crucial step. Not only the regular payments and collections will be settled through this bank account, but also it will become the designated account for tax deduction as well as social security payments.

Although most of the settlement can be done through the basic online banking account, some special affairs, such as the change of company information, cash withdrawal, foreign exchange settlement and sales, still need to be handled manually at the counter. Therefore, STAR suggests selecting a bank that has branches either close to company office or accessible to investor.

Typically,larger banks entails higher service fees. In terms of service efficiency, small and medium-sized Banks have more service experience of small and medium-sized enterprises and have higher efficiency. Of course, it is not to say that having a bank account with the larger banks has no merits. It still depends on the the needs of investors.

If the customer chooses to let the financial company act as the cashier, the financial company can also choose the bank they are most familiar with to open an account, so as to facilitate the bank service of the financial company in the future.

Usually, the following basic information is involved in opening a bank account:

1. Original copy of business license

2. Official seal, financial seal and legal representative seal

3. Original legal representative ID

4. Original identity card of the handler

5. Contact information of legal representative and large amount transfer contact person (fill in the mobile phone must be real and effective, the bank will call to confirm)

6. Articles of association (according to bank requirements)

7. Business address lease contract of the company (this contract is mainly for the virtual registered enterprise, generally providing the share-owned house or the actual office space lease contract).

After obtaining the bank account opening license, it indicates that the account has been opened successfully. The basic account opening time is generally about 7~10 days. After the license to open an account is obtained, you can apply to the bank for the relevant matters of USB key for online banking.

Upon completion of the basic account opening, a tripartite agreement shall be signed with the tax bureau, the social security bureau and the provident fund management center respectively.

Direct debit will be established after agreements are signed and uploaded online. Speaking from experience, most of the payments from these bureaus would not required to be settled in person at the counter, which is fairly convenient.

Depending on service offering in different banks, an enterprise would be eligible to apply for the general account, foreign currency capital account, foreign currency settlement account, foreign debt account and asset realization account based on the functionality the business requires. For example, aforeign-funded enterprise would need a foreign debt account to receive the fund when borrowing. Consult your bank manager for the specifics before applying.

A few other things to note...

1) Appointment is essential for opening any new account. It could be made through the handler or by calling the bank. However, it is easier to get an appointment through a handler who has connection with a bank manager.

2) For enterprises registered in Shanghai, the bank branch has to be within the jurisdiction of Shanghai.

3) Foreign banks and certain local commercial banks are not able to establish direct debit from either the Tax Bureau or the Social Security Bureau. We suggest to have your account with the major Chinese banks that has quality English banking service. Consult the bank manager in details before making the decision.