For your company abroad there are two kinds of account provider. Payment providers such as Mercury, Relay or Wise open an account online, usually within days and without travel. Banks take longer and offer cash, credit and a contact person in return. For the US LLC, our core product, a payment provider is usually the ideal start. This article shows what each institution can do and how to combine both wisely.
Three licences, one word “account”
A credit institution, in everyday terms a bank, takes deposits and grants loans. If the bank fails, deposit protection applies, the statutory protection of your balance up to a fixed limit.
An e-money institution issues electronic money, a payment institution executes payments. Their customers’ funds are not deposits. Both hold client funds separately from their own assets, usually at a bank (Directive (EU) 2015/2366).
A “fintech” is usually one of these, in the US often a company that runs accounts through partner banks, or a money transmitter licensed in the individual states. The provider’s licence is usually stated in its terms or legal notice and in the supervisory authority’s public register.
In short: a bank takes deposits, e-money and payment institutions safeguard your money separately.
Deposit protection: what applies where
In the EU, deposits are protected up to EUR 100,000 per depositor and per credit institution (Directive 2014/49/EU). Electronic money is not covered.
In the US, the FDIC, the federal deposit insurer, covers up to USD 250,000 per depositor, per insured bank and per account category. With providers that run accounts through partner banks, such as Mercury or Relay, cover can apply through the partner bank holding the client funds, if the FDIC conditions are met. The provider’s terms name that partner bank. Wise works with licences of its own and safeguards client funds separately; whether and how a balance is covered follows from its terms.
The practical rule: for day-to-day payments the fintech is ideal. Spread larger reserves to a bank.
In short: day-to-day payments through the fintech, larger reserves also at a bank.
Opening: online within days or on site within weeks
Payment providers open accounts remotely: video identification, document upload, decision within days. The review is the same as at a bank, because KYC, the statutory customer review, does not depend on the licence. What goes into the file is described in Business account abroad. The process is automated, so it pays to align address, passport and company details beforehand.
Banks, especially outside the EU, more often require attendance in person. In Georgia, TBC and Bank of Georgia review applications independently and may ask for further evidence. In return you have a contact person who understands an unusual set-up once you explain it.
In short: the fintech is fast and digital, the bank slower and personal.
What payment providers do well, and what they do not
Payment providers are strong at everything a location-independent services business needs:
- multi-currency accounts with local account details, for instance USD, EUR and GBP,
- low-cost international transfers,
- company cards with limits per user,
- integrations with accounting software and payment platforms.
What they typically do not offer:
- cash at a counter,
- loans, overdrafts or working-capital finance,
- letters of credit, bank guarantees and bank references,
- review of complex structures, for instance with a holding company in a third country or a nominee director.
For a single-member LLC with customers worldwide, the payment provider often covers the whole need. A trader with inventory finance adds a bank.
In short: payment providers handle payments in many currencies, banks add cash and credit.
Two payment routes: how to stay flexible
Any institution can end a business relationship, for example when a partner bank changes its risk policy or payment flows change markedly. Professionals therefore plan two payment routes with institutions holding different licences from the start. With an LLC that is simple: two payment providers, such as Mercury and Wise, or one payment provider and a bank in the country where you live. Keep the details in your application current as your business grows.
In short: set up the second payment route right away.
Germany, Austria, Switzerland
The choice of provider does not change the tax. The company is taxed where you take the day-to-day decisions, its place of management. If you live in Germany and run the LLC from there, the profits are taxed in Germany, wherever the account is. If you live location-independently or in a country without income tax, you use the account with the LLC’s full advantage.
Account data reach the state where you are tax-resident through automatic exchange of information (CRS). Austria and Switzerland have their own implementations.
In short: tax follows where you live and decide, not where the account is.
Our recommendation
For location-independent entrepreneurs GCS recommends the US LLC with a payment provider such as Mercury, Relay or Wise as the first account and a second payment route alongside. The EIN, the company’s US tax number, is usually the prerequisite for the account and included in the GCS package. We prepare the application, and the decision usually comes within days rather than weeks.
If you live in the EU and run a company there, for instance a Ltd in Cyprus, open the account with a local bank and add a payment provider. For a Georgian LLC the route leads to TBC or Bank of Georgia (Georgia country page), usually with attendance in person. Residence shows the matching residence models.
The order is the same in every case: company with tax number, then account with a complete file, then card acceptance and payment platforms for customer payments.
What to do now
Clarify what the account must do: currencies, volume, cash, credit. Check each provider’s licence in the supervisor’s register. Plan two payment routes and assemble the file along the “Account opening documents” checklist. As part of international banking, GCS clarifies the requirements of suitable institutions, prepares the file and handles the follow-up questions. The institution decides on the account.