Under Italian law all those who are interested – therefore including foreigners (individuals and legal entities) residing or even not residing in Italy – have the right to open a bank account with an Italian bank. Foreigners residing in Italy can open a bank account just like Italian citizens residing in the territory. Foreigners not residing in the country can only open a “non-resident account” (“conto non residenti” or “conto estero”). Foreigners can open a bank account in Italy by going to the bank branch of interest or simply by asking for assistance from agencies specialized in providing services to immigrants (in this case the customer is usually asked to pay a fee). The customer can usually withdraw from the contract at any time, without penalty and without costs of closing the account, by sending a registered letter (raccomandata a/r) to the branch of the bank where he has his bank account.
1) Currency residence (“residenza valutaria”)
In order to know how foreigners can open and close a bank account in Italy, considering that foreigners residing in Italy can open a bank account just like Italian citizens residing in the territory while foreigners not residing in the country can only open a “non-resident account” (“conto non residenti” or “conto estero”), it is important to understand when a citizen/foreigner can be considered a resident.
In this case, we should refer to the so-called ”currency residence” (“residenza valutaria”), which is based on a simple qualification that is recognized in favor of the interested party in presence of certain factual conditions, and is not to be confused with a registered residence (“residenza anagrafica”).
The currency residence is in fact based on the “usual abode” (individuals) / “real seat” (legal entities) or on the place of “production of income” other than occasionally. According to D.p.R. 148/1988, art. 1, par. 2, the following are therefore considered residents:
1) Italian citizens whose usual abode may be in Italy or abroad, but whose employment, self-employment or entrepreneurial activities are carried out in Italy “other than occasionally”;
2) foreign citizens whose usual abode is in Italy, but exclusively as regards employment, self-employment or entrepreneurial activities are carried out in Italy “other than occasionally”;
3) legal entities, associations and organizations without legal personality with effective seat in Italy;
4) legal entities and other entities that do not have legal personality established abroad and with a secondary seat in Italy, but exclusively for the activities carried out in Italy with a permanent establishment.
All other individuals and legal entities that are not included in the above list cannot be considered as “currency residents”.
The interested party can produce a simple statement declaring his residence and he can prove his abode with any proper document, a copy of the lease or loan for use of the property in which he abides or a document that proves the person belongs to the family of the tenant. Furthermore, it can also be proven by a certificate of registration into the AIRE – Anagrafe Italiani Residenti all’Estero (only Italian citizens).
The “usual abode” is presumed when two years have passed since its beginning, otherwise it can also be demonstrated by a statement from an employer (if applicable).
“Non-occasional activity” can be proven by a statement from the employer or, for the self-employed and entrepreneurs by means of fiscal records of the company or other certificates or statements issued by the tax authorities.
“Permanent establishment” can be proven through tax documents issued by Italian authorities or any other documents that demonstrate the actual carrying out of activities in Italy, such as, for instance, the registration of the secondary seat of the company at the Chamber of Commerce.
The interested parties shall notify all other parties of any changes in currency residence.
2) Foreigners and Italian bank accounts in general
First of all, it should be understood that access to banking services is not automatic but is subject to evaluation by the bank of the requirements for the granting of said contract and, however, in any case, requires the finalization of the contract.
With regard to foreigners, they can open a bank account in Italy (regular or non-resident bank account) by going to the bank branch of interest or simply by asking for assistance from agencies specialized in providing services to immigrants (in this case the customer is usually asked to pay a fee). It is possible to open an account while abroad, for instance by mail (in this case the customer will usually need to fill in a form provided by the bank of interest, send a reference from his bank, copy of his identification document, tax code, certificate of his signature, euro draft or whatever else the bank requests). Banks rarely allow customers to open non-resident accounts online.
Each bank sets its own regulations regarding fees, commissions, fixed costs, interests, operations, checkbooks, bank drafts, credit/debit cards (ATM), (foreign) wire transfers, possible orders of payment of utilities, periodic payments, internet banking, mobile banking, online statements (it is recommended because it generally avoids the payment of a few Euros compared to the paper format), telephone recharges, communications of the bank via email, etc..
Moreover, some accounts also offer insurance solutions in addition to the cost of the account (information support for certificates, documents, and other paperwork, payment of travel expenses to return to the country of origin in case of death of a family member, etc.).
Since there are many banks that offer several different types of accounts, when the customer wishes to open a bank account, he must be aware of what specific operations can be performed with that type of account, what operations can/should be performed at the counter and what online (home banking).
Opening a bank account is usually, but not always, free. The costs of the account are generally partly fixed and partly variable, in addition to stamp duties required by law. With reference to bank accounts, the stamp duty is due, on an annual basis, at the fixed rate of € 34.20 for individuals and € 100 for legal entities*. However, the stamp duty is not due if in the account there is an amount of less than € 5,000.
Under Legislative Decree 231/2007 (Anti-Money Laundering Regulation) the bank, at the time of the opening of the account, shall ask the customer to fill in a form which is intended to identify the customer’s “profile” (financial identification of the applicant). The customer must also “register” his signature at the bank so that later the same bank will be able to check the provenance of the orders (if it is a joint account contract, pursuant to art. 1854 of the Italian Civil Code (“c.c.”) all co-holders must register their signatures at the bank). However, nowadays the so-called “internet/home banking” is becoming more and more widespread. Through this, the holder of a bank account, after registering on the website of the bank, will be able to perform bank operations through internet (a.e. bank transfer, payment of bills, etc.), without any need to physically enter into the bank to issue an order.
When the customer opens the account, although it is not mandatory, in most cases the bank recommends depositing a minimum initial amount.
It is very important to read all the conditions specified in the contract, even the small printed ones, and the ones contained in the Information Sheet (“Foglio Informativo”). The customer should also ask the bank for any necessary clarifications before signing the contract. If it is difficult for the customer to fully understand the terms and conditions, he may ask the bank to provide documentation in English or to translate/explain it.
Italian banks still tend to be a little bit distrustful of foreigners, probably for reasons related to the greater difficulty of ascertaining their solvency and the eventual recovery of debts. Therefore, it could be difficult for foreigners to access bank loans or overdrafts**.
As the services offered and the costs thereof vary from bank to bank, it is very important for customers to carry out in-depth research and carefully evaluate all the contractual conditions before going to a bank to open an account. In this regard, it is possible to compare bank accounts over the internet (e.g. www.altroconsumo.it/conti-correnti or http://www.confrontaconti.it) or to turn to an expert who can provide assistance.
We suggest opening online bank accounts which generally have lower costs for operations, are easy to use and allow customers to perform all operations while at home, at the office, or even abroad. In this case, cash and checks can be deposited into the account through the appropriate ATMs of the bank of interest displaying the word “deposits”.
3) Foreigners residing in Italy
As mentioned above, foreigners “residing” in Italy can open a bank account just like Italian citizens residing in the territory.
In addition to the above information regarding proof of currency residence, the documents required to open a bank account are the following:
1) identity document (identity card/passport/Visa);
2) tax code (codice fiscale);
3) residence permit (or any other official document that is proof of residence);
4) banks often demand a proof of employment or self-employment status (employment contract, income tax return etc.).
4) Foreigners residing abroad
Foreigners who are in Italy but reside abroad, nevertheless have the possibility of opening an Italian bank account which is called a “non-resident account” (“conto non residenti” or “conto estero”). This kind of account is reserved exclusively to non-residents in accordance with the aforementioned law on currency residence.
The following documents are required to open a non-resident bank account:
1) identity document (passport);
2) tax code (codice fiscale);
3) Italian address (often, to prove the Italian address, a paid utility bill such as water, energy, gas etc. is required);
4) banker’s draft (not always).
Banks generally propose “Package” accounts to non-resident foreigners, which are essentially accounts that provide, in exchange for the payment of a fee, the possibility of performing a certain number of banking and non-banking operations. The package accounts are distinguished as either the accounts “with franchise”, in which the fee includes a limited number of transactions, or accounts “with no franchise”, in which the fee includes an unlimited number of transactions.
Generally, the kinds of accounts offered to foreign customers are similar to those offered to Italians with some small difference in costs and services. The commission costs, for example, may be higher, but, on the other hand, some banks include in the cost of the contract, in addition to usual services, some other “free” services such as, for example, a number of bank transfers to foreign countries.
The non-resident account can be both in Euros and in a foreign currency among the main ones. Generally, but not always, the non-resident account is opened in the currency of the country of origin because currency exchange commissions are always very high.
Banks usually allow, in case the needs of the customer change, to switch to a different type of account.
5) Examples of non-resident bank accounts
- Package di Conto Corrente, Conto Genius One Non Residenti, Unicredit;
- Conto corrente Start non residenti, Banca Nazionale del Lavoro S.P.A. (BNL)
- Conto corrente non residenti in euro di Credito Valtellinese;
- Conto International, Banco Popolare;
- Conto corrente per non residenti in divisa e in euro, Banca Popolare di Milano;
- Conto corrente non residenti in euro, Cassa Rurale di Rovereto Bcc;
- Conto corrente non residenti in euro, Cassa di Risparmio di Fano;
- Conto Corrente Libero non residenti, Veneto Banca;
- Conto Corrente ExtraPiù non residenti, Extrabanca;
- Conto Corrente residenti estero, Banca Sella;
- Conto non residenti in euro, Credito Cooperativo di Brescia.
Please note that the list above contains just a few bank accounts to be intended as examples.
6) Withdrawal and closure of the bank account contract
If a specific duration has been planned, the bank account contract expires at the end of the period agreed upon. If the contract has been stipulated for an indefinite period, either party may terminate the contract at any account closure (deadlines that are set to determine the balance), by giving notice at least ten days in advance.*** In accordance with the banks’ information sheets, the customer can usually withdraw from the contract at any time, without penalty and without costs of closing the account. The contract also ceases in the case of death, interdiction or bankruptcy of the account holder.
To close the bank account the customer must send a registered letter (raccomandata a/r) to the branch of the bank where he/she has his/her bank account.
If the account is a joint account with joint signatures, the closure request must be undersigned by all holders of the account. If the signatures are disjointed, it is then sufficient that only one holder signs the request.
If the customer is holding a securities deposit he/she must ask for the closure of this account as well.
The customer should return all debit/credit cards cut in two and any unused checks which must be canceled. Before sending the request for closure it is advisable to contact the bank to be sure of their specific closing procedure.
If the account holder is deceased, in order to close the account the heirs will have to go to the bank and deposit a declaration in which they claim to be heirs (“dichiarazione sotitutiva di atto di notorietà”), and fill in a form provided by the bank where they indicate their intention to close the account. Subsequently, they can transfer any remaining sums to a bank account of their choice.
The maximum time required for closing the account usually varies from 6 to 30 working days.
If you need assistance in writing the registered letter to close your bank account, send an email to email@example.com or fill in the Contact us form.
7) Complaints and legal actions
If a customer wishes to file a complaint, this should be sent by registered letter (raccomandata a/r) or email to the Claims Office of the bank which must respond within 30 days of receipt. If the customer is not satisfied or has not received a response within the period of 30 days he can contact the Banking and Financial Arbitrator – ABF (www.arbitrobancariofinanziario.it).
According to Legislative Decree 28/2010, art. 5, par. 1 bis, whoever intends to proceed with a legal action in relation to a dispute concerning banking and financial contracts shall, assisted by a lawyer, prior to addressing the Court, make an attempt to mediate by addressing, either:
1) the Bank Conciliator (www.conciliatorebancario.it) or
2) one of the other mediation bodies specialized in banking and financial matters, registered at the Ministry of Justice, or
3) the Banking and Financial Arbitrator.
The mediation process must be undertaken, otherwise legal action before an Italian court will not be admissible.
8) The bank account contract under Italian law: brief notions.
It should be firstly noted that the bank account is a real “atypical” contract (art. 1322 of the Italian Civil Code)**** stipulated under Italian law between the customer and the bank and, therefore, is governed by the specific provisions contained in the contract and, as far as possible, by the Italian Civil Code (art. 1852 c.c. and following). The bank account contract, in fact, has no specific regulation in the Civil Code. However, certain provisions of the Civil Code, and in particular articles 1852-1857 c.c., that regulate banking operations, and articles 1826 (Costs and rights of commissions), 1829 (Credits from third parties), 1832 (Approval of the account) apply to this atypical contract. Further regulation can be found in the Legislative Decree 385/1993, also known as the Consolidated Banking Act – (T.U.B.).
A bank account is, therefore, a contract under which the bank agrees to perform direct/indirect debit/credit operations (custody of money, crediting of amounts, payments, cash withdrawals, bank checks, bank transfers) on the customer’s direct/indirect orders, in exchange for a fee.
The customer creates a fund at the bank (current account) through which all incoming and outgoing requests are performed. These cash transactions are recorded by the bank in debiting or crediting entries (detailing movements – deposits and withdrawals) with a final indication of the (positive or negative) balance.***** The fund is generally made up by depositing money into the account (art. 1834 c.c.), but can also derive, for example, from a credit transfer (art.1842 c.c.) or from other sources.
With the bank account, the account holder can dispose of the sums at his disposition at any time, subject to compliance of the notice period as may be agreed upon (art. 1852 c.c.).
The bank account also may be held jointly with the right for the co-holders to carry out operations separately. In this case, pursuant to art. 1854 c.c., the co-holders are considered joint creditors or debtors of the balance of the account.
Under Legislative Decree 231/2007 (Anti-Money Laundering Regulation) the bank, at the time of the opening of the account, shall ask the customer to fill in a form which is intended to identify the customer’s “profile” (financial identification of the applicant). The customer must also “register” his signature at the bank so that later the same bank will be able to check the provenance of the orders (if it is a joint account contract, pursuant to art. 1854 c.c. all co-holders must register their signatures at the bank).
The bank is responsible according to the rules of the contract of “mandate” for the execution of orders received from the depositor or other customers (art. 1856 c.c.).******
The account statement is sent to the customer on an annual basis or, at the option of the customer, semiannually, quarterly or monthly. In the absence of a written objection by the customer, account statements and other periodical communications to customers (including changes to the current account) are considered approved after sixty days from receipt.*******