Why Do Singaporean Companies Favor Hong Kong Bank Accounts? The Real Reasons and Benefits

Why Do Singaporean Companies Choose to Open Bank Accounts in Hong Kong? Revealing the Secrets and Advantages

In recent years, with the continuous changes in the global financial market and the acceleration of corporate internationalization, an increasing number of Singaporean companies have begun to pay attention to and choose to open bank accounts in Hong Kong. This trend reflects not only the complementarity of the financial environments between the two regions but also the strategic considerations of companies in cross-border fund management, tax optimization, and business expansion.

First, Hong Kong's status as an international financial center remains strong. Its financial system is highly developed, its regulatory framework is mature, and it has a wide international network. According to the Asia Financial Centres Index AFCI report published in June 2025, Hong Kong ranks third globally in financial centers, following London and New York. This provides strong credibility for Singaporean companies. Hong Kong and Singapore are both Commonwealth countries with similar legal systems, shared languages, and comparable cultural backgrounds, making cooperation between companies from both regions more seamless.

Second, Hong Kong offers significant advantages in cross-border fund flows. Singaporean companies often engage in international trade, investment, and overseas financing, and Hong Kong serves as a bridge connecting mainland China with the global market, offering efficient and convenient financial services. For example, in March 2025, the People's Bank of China and the Hong Kong Monetary Authority announced further deepening of cross-border RMB settlement cooperation, promoting more companies to conduct RMB transactions through Hong Kong. This is a major benefit for Singaporean companies that rely on RMB settlements.

Third, Hong Kong's tax system is relatively flexible, helping companies achieve tax optimization. Although Hong Kong does not impose corporate income tax, its tax policies on offshore income are relatively lenient, especially the tax exemption policy for non-local profits, which has attracted many multinational companies to establish branches or subsidiaries there. In April 2025, the Hong Kong Inland Revenue Department issued the 2025 Tax Guide, clearly stating that income from offshore operations is tax-exempt, providing Singaporean companies with more flexibility in financial planning.

Hong Kong's banking system is renowned for its security and professionalism. Many internationally renowned banks have branches in Hong Kong, such as HSBC, Standard Chartered, and Citibank, offering services ranging from foreign exchange transactions to letter of credit issuance and trade financing. These banks have extensive experience in handling cross-border business and can provide comprehensive financial support to companies. For instance, in May 2025, HSBC announced enhanced digital banking services across the Asia-Pacific region, further improving customer experience.

At the same time, Hong Kong's financial market is highly open, making it easy for companies to diversify their investments. Singaporean companies can access a broader capital market through Hong Kong, including various financial instruments such as stocks, bonds, and funds. In June 2025, the Hong Kong Stock Exchange introduced several new measures to encourage more international companies to list in Hong Kong, offering Singaporean companies more financing channels and capital operation opportunities.

It is worth noting that although Hong Kong has many advantages, Singaporean companies opening accounts there also face certain challenges. For example, operating costs in Hong Kong are relatively high, the bank account opening process is strict, and compliance requirements must be met. Before making a decision, companies need to comprehensively evaluate their needs and cost-benefit ratios.

In conclusion, Singaporean companies choose to open bank accounts in Hong Kong based on a comprehensive consideration of multiple factors. Whether in terms of the financial environment, tax policies, or cross-border fund management capabilities, Hong Kong provides strong support. In the future, as economic ties between the two regions continue to deepen, more Singaporean companies are expected to join this trend, jointly exploring broader development opportunities.