A foreign currency bank account allows individuals and businesses to make international trade and cross-border finance.

But the question is: who can open a foreign currency account in Madagascar?

This article gives an answer to that, but also provides a comprehensive and informative guide for both individuals and businesses interested in this financial service.

What Is a Foreign Currency Bank Account

A foreign currency account is a specialized bank account designed to hold and manage funds in currencies, other than the local currency.

This type of account provides greater flexibility for individuals and businesses involved in international transactions, such as imports, exports, and payments to foreign partners.

Why Open a Foreign Currency Account in Madagascar

Opening a foreign currency account in Madagascar offers several benefits. You can easily manage different currencies in one account, protect your money from changing exchange rates, and make international payments smoother.

By opening such an account, you can simplify your international business finances, safeguard your assets from currency fluctuations, and make sure you follow local rules for foreign currency transactions.

Step-By-Step Guide to Open a Foreign Currency Account in Madagascar

Step 1: Meet Eligibility Criteria and Provide the Required Documentation

Any customer holding an MGA current account can open a foreign currency account. 

With that said, there are certain conditions to keep in mind. 

For individuals

Non-business individuals must be residents of Madagascar to open a foreign currency account. They will need to provide valid identification (ID card or passport), proof of address, and evidence of a stable income source.

Business individuals, or entrepreneurs, do not need to be residents of Madagascar. However, they must provide valid identification and proof of their business activities which are any relevant documentation to verify business operations.

Additionally, they will need to obtain a bank reference from a foreign bank, to be transmitted by SWIFT to the local bank where the account will be opened.

For businesses

Businesses seeking to open a foreign currency account in Madagascar must be legally registered entities. 

They will need to provide a range of documents, including their certificate of incorporation, articles of association, tax identification number (locally called NIF/STAT), and proof of their business address. 

Identification documents of shareholders and managers, and financial statements are also in order. Note that there are specific requirements for:

• SARLs: Meeting record for non-statutory managers, power of attorney for special representatives.
• SAs: Deliberation of the Board of Directors designating key officers.

It’s important to consult directly with a bank representative to get the most accurate and up-to-date information on specific eligibility criteria and required documentation.

Step 2: Get Finex Authorization

The Foreign Currency Accounts Service or Finex (within the Credit Institutions and External Finances, attached to the Ministry of Finance) is responsible for processing requests to open foreign currency accounts and monitoring their operation. Therefore, they provide authorization for any request to open a foreign currency account.

For businesses involved in import/export, Finex has more requirements after the opening of the account. Among those: 

• Mandatory Bank Domiciliation: For exports exceeding 3,000,000 Ariary, bank domiciliation is mandatory. This is done online through the SIG-OC platform, and the selected bank validates the request.
• Repatriation of Export Proceeds: All export proceeds must be repatriated within a specified timeframe (90 days for goods, 30 days for services) through a bank transfer.

Step 3: Open Your Foreign Currency Account

Once your documentation is ready and Finex authorization is obtained, proceed to open the account at your chosen bank. Available currencies in Madagascar are EUR, USD, GBP, MUR and CHF. 

It’s important to note that transfers from one foreign currency account to another are not permitted between residents, except in cases provided for by legislative or regulatory texts.

Account operations include:

• Credit: Only foreign currency transfers received, bank checks, and traveler’s checks in foreign currency are accepted.
• Debit: Transactions are limited to transfers and the issuance of traveler’s checks.

Fees and terms related to foreign currency accounts are made available to the public through display or other appropriate means. The bank reserves the right to modify these conditions at any time with one month’s notice before new rates take effect.

All in all, a foreign currency account in Madagascar simplifies international transactions, protects against currency fluctuations, and ensures regulatory compliance.

 Any person can open a foreign currency account, providing that they have a deposit account. 

This guide provides a first glance on general and specific eligibility requirements, documentation, and authorization. However, consulting a bank for the latest information is advised. 

The process can be daunting, but Madagascar Invest can help you open a business in Madagascar with a bank account, for you to access new opportunities in international finance and trade.