Virtual bank accounts in Singapore: Fees, features, and how to choose

In 2019, Singapore took a bold step into the future by introducing digital banking licences.¹ These licences allowed non-banking entities to offer digital financial services to both consumers and businesses. As 94% of small-to-medium enterprises (SME) start digitising their businesses², virtual bank accounts offer an efficient way to start banking, with fast account setup and 24/7 access to financial services. 

In this article, we'll talk about everything you need to know about virtual bank accounts. We'll explain how they work, the benefits they offer, and if they're right for your business. We’ll also explore fintech firms like Airwallex and see how its end-to-end financial solution can help you grow without limits.

What is a virtual bank account?

A virtual bank account is an online-only account offered by financial institutions. This allows SMEs to open business accounts and make transactions from any device, without visiting a bank branch. 

In Singapore, virtual bank accounts are offered by fintech firms and digital banks who are regulated by the Monetary Authority of Singapore (MAS).³

• Wholesale Digital Banks. These banks cater only to businesses. Green Link Digital Bank and ANEXT are the only wholesale digital banks in Singapore.

• Digital Full Banks. These banks can serve individuals and businesses. Maribank is the only digital full bank in Singapore that caters to businesses.

• Fintech business accounts. While not technically banks, fintech firms offer an excellent alternative to virtual bank accounts. On top of essential payment services, fintech business accounts have tools to automate financial tasks like expense management and bill payments. Examples include Airwallex, Wise, and YouBiz. 

How do virtual bank accounts work?

Virtual bank accounts in Singapore work by providing all the traditional banking services on a fully online platform. They operate differently from online banking offered by traditional banks like DBS, as they have no physical locations for cash deposits, withdrawals, or account opening. They are also different from fintech business accounts, as they offer banking services only.

You can apply for a virtual account online and access banking services via a desktop or smartphone app. Traditional banks have physical branches and often require an in-person appearance during the account opening process. Although they increasingly offer virtual banking services via a desktop or mobile app, they may lack specialised fintech services.

Fintech business accounts offer more than just transfers and currency exchange; they also support business operations through services like payment gateways and expense management.

Here’s a quick summary comparing virtual bank accounts, traditional bank accounts, and fintech business accounts:

Comparing virtual bank account options in Singapore

There are currently 5 virtual banks in Singapore, although only 3 of these cater to businesses. Let’s take a look at what MariBank⁵, ANEXT Bank⁶, and Green Link Digital Bank⁷ can offer. If your business needs a flexible fintech partner that will enable your rapid growth, consider using the Airwallex Business Account instead.  

ANEXT Bank

Known for: Business loans

ANT Group’s ANEXT Bank provides a virtual bank account that lets SMEs hold and transact SGD and USD. Businesses with an SGD or USD windfall can earn interest through their fixed deposits, with just a minimum amount of USD 5,000. There’s also a business loan of up to SGD 500,000, which can be repaid via a traditional instalment plan or “pay-per-use” plan.

Green Link Digital Bank

Known for: Supply chain financing

Green Link Digital Bank (GLDB) was the first virtual bank to launch in Singapore. Of the 3 banks, they have the widest range of services. They offer multi-currency accounts in SGD and USD, and will soon offer JPY and CNH. 

On top of overdraft loans and term loans, GLDB also offers supply chain financing. This allows businesses to access up to 100% of the funds from sales invoices that are tied up in their supply chain.

MariBank

Known for: Supporting Shopee sellers

MariBank is Sea Group’s digital bank in Singapore. They offer banking solutions for retail consumers and the Mari Business Account for SMEs. 

Businesses can get 2.5% p.a. interest on cash in their account and unlimited free local transfers. They can also get business loans of up to SGD 200,000 and repay for a period of up to 12 months with no prepayment fees. Shopee sellers also get one free withdrawal into their Mari Business Account per day. 

How to choose the right virtual bank account in Singapore

When choosing a virtual bank account for your business, it's essential to find one that aligns with your needs and growth plans. With so many options available, focusing on these key factors will help you make the best choice:

• Fast account setup. Consider how quickly you can set up an account and get started banking. Some fintech firms can get you started as quickly as one business day.

• Global reach. Check the provider’s global reach to ensure it supports the markets you do business with. A bank or fintech with a strong global presence can offer lower international transfer fees and support local payment methods.

• Scalability. As your business expands, features like multi-currency accounts, transaction limits, and local payment options should easily adapt to larger volumes. This flexibility eliminates the need to switch providers as your needs change.

• Fees. Pay attention to the costs for your most commonly used services, such as international transfers, eCommerce payments, or corporate card transactions. Watch out for monthly subscription fees and other admin costs to avoid surprises.

• Security and regulations. At a minimum, your business account provider should be licensed and regulated by the Monetary Authority of Singapore (MAS). This ensures that customer funds are safeguarded according to the stringent standards set by the MAS. Digital banks should also be PCI DSS compliant and have fraud prevention systems in place.  

You can use the same criteria to evaluate fintech alternatives like the Airwallex Business Account, which offers a full range of end-to-end financial services and can be opened online as quickly as one business day.

Should you consider opening a virtual bank account for your business in Singapore?

Yes, you should consider opening a virtual bank account or fintech business account especially if you run a digital-first business and need flexible solutions to keep pace with your growth. Fintech accounts like Airwallex can help you build your overseas presence faster with local currency accounts you can open in minutes, and cost-effective transfer fees.  

On the other hand, Singapore’s traditional banks are well-established and offer digital banking services. However, these services come at a price. Businesses can expect to pay fees for account maintenance, transactions, or not meeting minimum balance requirements, which can add up over time. 

However, if your operations require physical bank visits or highly specialised banking services like in-depth financial advice, you may want to weigh the benefits of fintech  against traditional banks.

Virtual account for global businesses in Singapore: Airwallex Business Account

Singapore businesses with overseas suppliers or global customers often struggle with high SWIFT fees that chip away at profit margins. While fintech and virtual banks offer low-cost financial services, juggling multiple platforms can be an administrative headache. The challenge lies in finding the right balance between reducing fees and keeping operations efficient.

If you want to handle all your financial tasks in one place, look no further than the Airwallex Business Account. We are not a bank, but we are an MAS-licensed payment institution that offers an end-to-end platform for your global financial operations. 

Unlike virtual banks, the Airwallex Business Account offers a wide range of services beyond money transfers: 

• Multi-currency Global Accounts. Instantly create 23+ Global Accounts with a dedicated account number and local bank code. This lets you receive, hold, and spend foreign currencies without unnecessary conversion. 

• Fast, low-cost international transfers. Pay zero or low cost international transfer fees when you make non-SWIFT transfers to 120+ countries. We use local payment rails, which means no SWIFT fees and fast overseas transfers, with 70% of transfers arriving the same day.

• Market-leading exchange rates. Maximise the value of every dollar with our friendly interbank exchange rates and currency risk management. 

• Borderless Cards and Expense Management. Issue unlimited virtual and physical Borderless VISA Cards for free. Our real-time expense monitoring and custom controls prevent misuse and keep an accurate record of expenses.

• Automated bill payments. Save time paying bills, employees, and suppliers. Send batch transfers for up to 1,000 recipients across countries, currencies, and transfer methods.

• eCommerce payment gateway.  Accept payments in 160+ payment methods and 180+ countries with our multi-currency payment gateway. Like-for-like settlement in 11 currencies cuts out unnecessary conversion and boosts your bottom line.

Creating an account is easy and fast - here’s how:

Step 1: Sign up for an Airwallex Business Account 

Step 2: Verify your business by uploading documents online Step 3: Start using your account in 1-3 business days!

How to open a virtual bank account in Singapore

Opening a virtual bank account in Singapore is a straightforward process. Simply go to the website of your chosen bank and begin the application process.

Before you do so, make sure you’ve got soft copies of the following documents. You’ll need to submit this with your application. This is not an exhaustive list, as each virtual bank and registered entity have different requirements:

• Proof of business registration. This is typically your Accounting and Corporate Regulatory Authority (ACRA) business profile.

• Proof of business address. This can be a rental agreement or any official document indicating the business's registered address.

• Company directors and shareholder information. You need to provide identification documents and proof of residential addresses for the Ultimate Beneficial Owners (UBO), directors, and shareholders. Proof of address can include a bank statement, utility bill, or phone bill. 

• Ownership structure chart. Banks may need to understand your shareholding structure, and may require an equity or ownership chart.

• Authorisation letter. If you are not the director of the registered business, provide a letter saying you have the authority to act on behalf of the company.

Are virtual bank accounts safe to use?

Yes, virtual bank accounts are safe to use, especially in Singapore, where they are regulated by the MAS with a Digital Bank License. The MAS ensures that these banks meet strict security and financial standards, giving businesses confidence that their funds and data are protected. Fintech firms offering virtual business accounts are also licensed as Major Payment Institutions, which means they follow rules and safeguards set by the MAS. 

While virtual banking may feel new, the regulatory framework in place ensures that your business's financial operations are secure and protected.

Final thoughts

Virtual banks are an interesting complement to Singapore’s legacy banks. Despite being newcomers to the banking industry, they lower overall transaction costs and offer convenient digital services.  It's not about one being better than the other, but about understanding your business's needs and choosing the right combination of services.  

If you want to fast-track your global expansion, consider using a fintech business account like Airwallex. You can get started as quickly as one business day, and enjoy a full range of end-to-end payment solutions that let you go-to-market quickly.

Unlike many fintech accounts in Singapore, Airwallex doesn’t just focus on currency exchange and transfers. Our technology enables growth throughout your entire financial operations, with fast access to multi-currency eCommerce payments, corporate cards and expense management. Automate manual tasks with APIs that sync Airwallex with your accounting software or eCommerce store.

Get started with Airwallex today and grow your business with tech that does more for you. But don’t just take our word for it - Singapore businesses like Dreamcore, Little Blossom, and igloohome have built thriving global businesses with Airwallex.

Frequently asked questions

1. Are virtual bank accounts suitable for startups and small businesses?

Yes, virtual bank accounts are a great option for startups and small businesses. They offer lower fees and a fully online application process, making it easy to start banking in any location. If you want a complete solution for your global business, fintech firms like Airwallex offer an end-to-end payments platform for all your financial operations.

2. What customer support options are available for virtual bank account holders?

Customer support options for virtual bank account holders can vary depending on the bank. Most virtual banks have digital support channels like live chat, email, or in-app support. Others have phone support and even dedicated account managers. Airwallex has a Singapore-based support team with local expertise, ready to help you with all your business needs.

3. What potential risks are associated with using virtual bank accounts, and how can they be mitigated?

The risks associated with using virtual bank accounts include cybersecurity threats and the fact that they are run by entities with no track record in banking. To mitigate these risks, it's important to choose a virtual bank regulated by MAS. Staying vigilant with your account activity and regularly updating passwords can also help keep your funds safe.

4. Can I link a virtual bank account to multiple payment gateways in Singapore?

At the moment, most virtual bank accounts in Singapore don't offer APIs to link directly with payment gateways. Airwallex has their own payment gateway, which can be easily integrated with eCommerce platforms and accounting software. This makes the Airwallex Business Account a great option for businesses looking for a single platform for all their financial operations. 

5. What are the limitations on transaction volumes for virtual bank accounts in Singapore?

The transaction volume limits for virtual bank accounts in Singapore can vary depending on the financial institution. Some virtual banks may have daily or monthly transaction limits, while others may offer higher limits. Check with your virtual bank about any restrictions based on your business needs. If your business requires handling larger volumes, fintech solutions like Airwallex might offer more flexibility with fewer restrictions on transactions.

Sources

1. https://www.mas.gov.sg/news/media-releases/2019/mas-to-issue-up-to-five-digital-bank-licences

2. https://www.imda.gov.sg/-/media/imda/files/infocomm-media-landscape/research-and-statistics/sgde-report/singapore-digital-economy-report-2023.pdf

3. https://www.mas.gov.sg/regulation/banking/digital-bank-licence

4. https://www.anext.com.sg/partner-us

5. https://www.maribank.sg/product/mari-business-account

6. https://www.anext.com.sg/ 7. https://www.glbank.com/

8. https://www.gxs.com.sg/

9. https://trustbank.sg/

10. https://www.glbank.com/data/tosend/resource/upload/GLDB-Fees-and-Charges.pdf

This publication does not constitute legal, tax, or professional advice from Airwallex nor substitute seeking such advice, and makes no express or implied representations / warranties / guarantees regarding content accuracy, completeness, or currency. If you would like to request an update, feel free to contact us at [[email protected]]. Airwallex (Singapore) Pte. Ltd. (201626561Z) is licensed as a Major Payment Institution and regulated by the Monetary Authority of Singapore.