If you’re planning to study or work in the US, setting up a bank account is one of the most important things to do as you start to pursue your American dream.
Opening a US bank account can be a hassle because of the application requirements. Knowing the key aspects of opening a US account can help you understand why a financial institution may ask for this information.
In this article, we’ll discuss everything you need to know about opening an account and the importance of each step.
Understanding the Basics of Opening a US Account
Opening a US bank account gives you easy access to banking services, such as receiving direct deposits, paying bills, withdrawing cash, and building savings. The process for opening an account is generally straightforward but can vary depending on the type of account and each bank’s requirements.
Financial institutions usually require several forms of identification and documentation to verify your identity, address, and eligibility. This process is called Know Your Customer (KYC).
The main goal of KYC is to prevent financial crimes, such as money laundering, fraud, and terrorism financing.
Do I need an SSN or ITIN to open a US account?
In most cases, the answer is yes. However, if you’re opening an account through Adro, you don’t need to have a SSN or ITIN.
Many major banks will ask for a Social Security Number (SSN) or an Individual Taxpayer Identification Number (ITIN). These numbers are primarily used for identity verification. Here are other reasons why they are commonly required:
- Identity Verification: An SSN or ITIN helps banks verify your identity, ensuring that the person opening the account is who they say they are. This is important for preventing fraud and identity theft.
- Compliance with Federal Regulations: US banks must comply with federal laws, such as the USA PATRIOT Act, which require them to verify the identity of every customer. An SSN or ITIN helps in complying with this requirement, but it’s not the only way to verify your identity as you can still provide other documents
- Tax Reporting: Banks use your SSN or ITIN to report any interest earned on your accounts to the Internal Revenue Service (IRS).
- Access to Additional Services: Providing an SSN or ITIN can also make it easier for you to access other financial products, such as credit cards or loans, as these numbers help build a credit history.
Why Do Banks Sometimes Require Additional Documents?
When opening an account in the US, especially for non-US citizens or international students, banks may ask for additional documents such as a passport scan, visa, or I-20 form.
These documents help the bank verify your identity, residency status, and eligibility to open an account. Here’s why these documents are sometimes required:
- Proof of Identity: A passport is a universally recognized form of identification, especially for non-US citizens. It helps banks verify that you are who you claim to be and reduces the risk of fraud.
- Verification of Residency Status: For international students, banks may ask for an I-20 form, which shows that you are legally in the US on a student visa and provides your school and enrollment information. This helps banks ensure compliance with immigration laws.
The US Address Conundrum
When you open an account, a valid US address is typically required. This is because banks need a way to verify your residency within the country and comply with federal regulations. The following are more reasons why banks typically require a US address:
- Regulatory Compliance: US banking regulations require banks to verify their customers' residential addresses to prevent fraud, money laundering, and other illicit activities. A US address ensures that the bank is dealing with legitimate customers.
- Alternative Solutions for Non-Residents: If you don’t have a US address, some banks may accept a friend’s or relative’s address or use a virtual mailbox service. However, these options vary by bank and may come with additional requirements.
When you open an Adro account, you can sign up with a non-US address to start. Then, once you’ve arrived in the US and figured out where you’ll be living, you can update your profile with your US contact details.
Importance of Submitting Your Phone Number
Financial institutions typically ask for a phone number when opening an account for security purposes, to facilitate communication, and to provide essential services to their customers. A phone number serves several key purposes, helping both the bank and you to maintain a safe and efficient banking experience.
- Two-Factor Authentication (2FA): One of the main reasons banks ask for a phone number is for Two-Factor Authentication (2FA). This process involves sending a verification code via SMS to confirm your identity during logins or transactions, adding an extra layer of protection against fraud.
- Account Alerts and Notifications: Banks use your phone number to send real-time alerts for account activities, such as deposits, withdrawals, or potential fraudulent actions. This helps customers monitor their accounts and act quickly if something suspicious occurs.
Photo or Selfie Requirements
Banks may ask for a selfie or a short video of yourself as part of the account opening process to enhance security and verify your identity.
This biometric verification step is becoming increasingly common, especially for online and mobile banking, to prevent fraud and ensure that the person opening the account is indeed the same person whose documents are being submitted.
Age-Restricted US Banking Accounts
Most US bank accounts have age restrictions due to legal and regulatory requirements that govern how financial institutions operate.
These restrictions are designed to protect both the bank and the customer, especially minors, who may not fully understand the responsibilities that come with managing a bank account.
However, many banks offer specific accounts for minors, like custodial accounts or joint accounts, where a parent or guardian manages the account until the child reaches a certain age. These accounts help minors learn about saving and managing money under adult supervision.
What Documents Do You Need to Open an Adro account?
Opening an Adro account is straightforward and designed to be as convenient as possible, especially for international workers and students moving to the US.
Unlike many traditional banks, Adro does not require an SSN (Social Security Number) or ITIN (Individual Taxpayer Identification Number), making the process hassle-free. Here’s what you’ll need to open an account with Adro:
- Passport: A valid passport is needed to verify your identity.
- Address: You can sign up using a non-US address, but you’ll need to provide and verify a US address before you can spend or withdraw money.
- Phone Number: A phone number is required for account security and communication.
- Age Requirement: You must be at least 18 years old.
Additionally, you should either be currently living in the US or planning to move soon with an approved US visa. The simplicity of these requirements makes opening an Adro account quick and efficient, allowing you to get started with your banking needs without the usual complexities.
Regardless of which company you choose, be sure to review the account requirements before signing up for your first US account. Good luck!
