Specifics of work of banks in Georgia

Georgia is a business and investment friendly country. Banking is one of the fastest growing sectors in the Georgian economy.

Banking system

Currently, Georgia has a two-tier banking system. At the first tier is the Central Bank, which determines monetary policy and regulates the activities of financial institutions. At the second tier are commercial banks, which provide services to individuals and legal entities.

The banking sector in Georgia is small, with 16 commercial banks, 13 of which have foreign capital, as well as branches of two foreign banks (Turkish Ziraat Bank and International Bank of Azerbaijan). Georgian banks have fairly strict capitalization standards, issue loans with maximum guarantees and practically do not issue unsecured loans, which essentially eliminates the possibility of bank bankruptcy.

To obtain a banking license in Georgia, you must have 50 million lari (more than 20 million US dollars). The purpose of this increase is to ensure the security and stability of the banking system.

One of the key features of Georgian banks is their openness to foreign investment. Many leading international banks have a significant share of foreign capital. This provides access to modern banking technologies and best management practices.

Georgian banks have not been involved in money laundering scandals, they are just starting to gain popularity and have not yet attracted close attention from other countries.

The central bank is the National Bank of Georgia (NBG). It sets monetary policy, issues licenses and supervises the activities of banking institutions and currency exchange offices. To regulate money circulation and encourage deposits in Georgian lari (GEL), the national legal tender, the NBG requires commercial banks to hold a certain percentage of their foreign currency deposit liabilities in reserve.

Advantages of Georgian banks

• In Georgia, you can open an offshore account for a company registered in a tax-free jurisdiction.
• There are banks where accounts are opened only by visiting the head office in person (Tbilisi), but it is also possible to open an account remotely, without traveling to Georgia.
• There are no requirements for minimum balances and minimum deposits on accounts.
• All accounts have an international IBAN number.
• Account management is carried out using Internet banking.
• The cost of transfers is significantly lower than in European banks.
• The probability of a Georgian bank defaulting is extremely low due to a reliable credit collateral system.
• The entire banking sector speaks Russian.

Largest banks

• Bank of Georgia

The largest financial institution in the country. Bank of Georgia is one of two banks that control more than 90% of the Georgian market. The shares of this bank are listed on the London Stock Exchange. Bank of Georgia has one of the most transparent reporting procedures. The bank's annual reports are available online and anyone can check the bank's financial stability.

Since 1994, the bank has built a wide network of branches, and now their number is more than 250. Representative offices are located in London, Budapest and Tel Aviv. The head office is located in Tbilisi.

An open account in the Bank of Georgia is possible for a non-resident company with substantial confirmation of ties to Georgia (an agreement on the presence of an office in Georgia, local counterparties, a warehouse, a store, etc.). For non-residents of Georgia, a personal visit to the bank branch in Tbilisi (Georgia) is required. Remote identification procedure is possible for residents of Georgia.

The term for opening an account in the Bank of Georgia from the moment the client signs the form at the bank is 2-3 weeks, there is no express account opening.

• Solo Bank

The Bank of Georgia also has premium banking under the Solo Bank brand. They provide a personal account manager and a Visa Platinum debit card with a number of benefits.

• TBS Bank

Another major player in the Georgian banking market. TBS Bank is listed on the London Stock Exchange and their annual reports are published every year. And, like Bank of Georgia, the financial side of this bank is also extremely attractive. The bank has about 150 branches all over Georgia, as well as more than 600 ATMs. TBS Bank also has premium banking. TBS Bank's premium brand is called TBC Concept. It also comes with a premium debit card with many benefits and a personal account manager.

• Liberty Bank

Liberty Bank is another one of the most popular banks in Georgia, its head office is located in Tbilisi. It has a large nationwide network of over 360 branches and 617 ATMs. Accounts are opened for non-residents upon presentation of documents confirming the origin of funds, bank statements, information about work in Georgia and the purpose of opening an account.

• Terabank

JSC Terabank has been providing banking services in Georgia since 1999. During its existence, the bank has changed its concept and rebranded several times. Since 2016, 45% of the bank's shares belong to the Arab Sheikh Al Nahyan, Chairman of the Dhabi Group. Since then, the bank has been called Terabank. Terrabanka's clients are representatives of small and medium-sized businesses, entrepreneurs, employers and their employees. The bank strives for an exceptional approach and individual service for each client.

Terrabank serves private and corporate clients from all over the world who have business ties with Georgia. Companies registered in tax-exempt jurisdictions are also considered. You can open an account with Terabank Georgia remotely.

• BasisBank

BasisBank, one of the fastest growing banks in Georgia, offers a wide range of consumer, business and private banking services. Its head office is located in Tbilisi, and there are about 40 branches throughout the country.

BasisBank is part of the Chinese Hualing Group. Resident foreigners simply need to open an account with this bank, while non-residents may have additional conditions. A notable feature is the availability of UnionPay cards for those with ties to China.

Eligibility to Open an Account in a Georgian Bank

Banking services in Georgia are available to both national and international clients. Some countries under international sanctions, such as Syria, Iran, Afghanistan, North Korea and others, are automatically excluded from opening bank accounts. Although citizens of Russia and Belarus may occasionally face refusal, this is not a common occurrence. Applicants from most other countries are usually successful in opening an account, provided that they properly submit all the necessary documents.

A key feature of opening an account in a Georgian bank is the requirement that the client has business ties to the country. This primarily concerns non-resident clients, who must prove one of the following: the presence of a local office, employees, contractors, partners or other business activity in the country. In addition to this requirement, some banks may require a personal visit to the main branch for physical identification of the client and signing of the necessary documents.

Types of bank accounts available in Georgia

Georgian banks, as a rule, do not have separate accounts for residents and non-residents. This is due to the fact that there are not many restrictions on opening bank accounts by foreigners in the country.

• Current account. It allows you to make transfers around the world without restrictions, exchange currencies and pay bills. You can make transactions and deposit funds in three currencies: GEL, USD and EUR.
• Deposit account.  Savings, the owner of such an account receives profit in the form of a percentage of the amount on the balance. The funds received can be withdrawn monthly or at the end of the contract, depending on the terms of the specific bank.
• Card account. This is a familiar plastic card, necessary for non-residents for convenient payments and purchases.

Requirements for opening an account in a Georgian bank

Opening a bank account in Georgia as a non-resident is easy. You have two main options:

1. In person.Visit a Georgian bank branch with your passport and any additional documentation they may require. The process usually takes about 30 minutes.

2. Through a representative.If you are unable to come to Georgia, you can appoint an authorized person using a notarized power of attorney and a notarized copy of your passport. Your representative can then open the account on your behalf.

Living in Georgia for 183 days gives you tax residency status. This may increase your chances of approval when applying for a bank account.

Documents required for a personal account

• Passport.
• Georgian phone number.
• Completed KYC bank form.
• Proof of income.
• For US/UK citizens: additional forms (e.g. W8/W9) may be required for tax compliance.

Required Documents for a Business Account

• Signed receipts and copies of ID cards for shareholders with 25% or more ownership.
• A Georgian phone number for the company is required.
• Official incorporation documents.
• A completed KYC bank form.

Opening a Bank Account in Georgia Remotely

To open a bank account in Georgia without your physical presence, delegating a representative through a notarized Power of Attorney (POA) is the only method. This POA grants your representative the authority to act on your behalf in banking matters.

Notarization (POA) and Apostille

The POA must be officially notarized. In some cases, an apostille may also be required to ensure its validity across international borders. Remember that Georgian banks do not accept digital versions of the POA, it must be sent in physical form.

Carefully draft the POA to cover all necessary banking and payment transactions. Otherwise, it may limit your representative’s actions, such as access to the account after it has been created, which will require another additional set of documents.

Choose an appropriate duration for the POA. It should not be too long, so as not to give you extensive control over your finances, and not too short, which may complicate the account opening process.

Preparing the Documents

You have prepared the POA for your Georgian bank account - now it is time to make it official. Please note that the notary must verify your identity and witness your signature on the power of attorney.

If your country is a party to the Hague Apostille Convention, you may need additional certification. Check with your notary or local government agency.

Document Translation and KYC Procedures

Any documents not in Georgian must be officially translated and notarized by a Georgian notary. Plan on this taking a day or two.

Banks everywhere have KYC (Know Your Customer) procedures. In Georgia, this means explaining your source of income, how you have accumulated your finances, and roughly how much money you will be depositing and withdrawing (but usually not asking for confirmation of these figures).

Banks weigh factors such as your country of origin when deciding whether to approve. If you are from a country that is not under sanctions, your chances of opening an account are very high.

Submitting an application

Once all your documents are ready, you need to submit an application to a Georgian bank. Although most banks have a standard list, keep in mind that some may request additional items.

Typical required documents:

• Power of attorney (notarized, translated into Georgian).
• Copy of passport (notarized, translated into Georgian).
• Completed KYC form (provided by the bank).

Possible additional requests:

• Proof of income. This can be an employment contract, lease agreement, etc., confirming legal sources of income.
• Proof of assets. Proof of ownership of property or other valuables.
• Bank statements. Some banks want to see your recent financial activity.
• Address details. Requirements vary - this could be a rental agreement, utility bills, hotel booking confirmation, or even just your address in your country of residence.

Most Georgian banks provide a debit card and access to online banking when you open an account. The review process usually takes about one business day. If all is well, your representative will get the green light with your new account details. In the unlikely event of a refusal, the bank will provide a reason.

The initial paperwork is followed by a follow-up visit, during which your trusted representative will receive the account agreement, your account details, and instructions on how to set up online banking. Don't forget - ask about changing the language for SMS notifications if needed.

Banks will usually assign you a contact person. This is your go-to for questions and managing your account in the future.