Bank Charges in Hong Kong – Types and Comparisons

What are bank charges?

When you take out a loan, the bank charges you interest. Similarly, there is a fee when you transfer money or make an ATM withdrawal. Banks charge a fee for every service they provide. On the flip side, many also offer free services, such as a limited number of free transfers in a month or an account opening fee waiver.

Different types of bank charges

These are the common bank fees to look out for when you open a Hong Kong business account:

1. Administrative charges

These are charges imposed by banks to maintain and keep your business account running. They include:

• Account set-up fee: Some banks charge a fee to open an account while others offer this service for free.  
• Account fee: This is what you pay either monthly or annually to maintain your account. A fee waiver for the first few months is common.
• Fall-below fee: If the account balance falls below a specified daily/monthly requirement, a fall-below fee or minimum balance service charge is incurred.
• Excess fee: If you use your business account to make a payment that exceeds your available balance, the bank might decline the payment request and hit you with an excess fee, also called overdraft fee. Or, it might accept the request and cover the excess amount. In this scenario, you’ll have to pay back the excess amount and excess fee.
• Early account closure fee: You pay this if you close your Hong Kong business account within six months or a year of opening it.
• Inactivity fee: Some banks in Hong Kong charge an inactivity fee or dormant account fee if an account has been idle for a long period, usually a year. This is usually a monthly fee.
• Premature withdrawal fee: Specific to fixed deposits or time deposits, this is charged when the deposit is withdrawn before maturity.

2. Transaction charges

Each time you deposit or withdraw cash, make a payment, or receive a remittance, your bank will charge you a fee (unless it is waived). The amount varies depending on the mode of transfer:

• Wire transfers, also called telegraphic transfers (TT), typically cost between HKD 150-200 per transaction for outgoing international transfers, plus correspondent bank charges. Like Singapore, these transfers use the SWIFT system and remain the preferred method for secure cross-border transactions despite higher fees. Learn more about wire transfers in our blog here.
• FPS (Faster Payment System) is Hong Kong's instant payment system that enables real-time transfers between banks and stored value facility (SVF) operators. FPS transfers in HKD and RMB are usually free for most banks when done online.
• CHATS (Clearing House Automated Transfer System) is Hong Kong's real-time gross settlement system for HKD, USD, EUR, and RMB transactions. CHATS transfers typically cost between HKD 50-200 depending on the currency and bank.
• e-Cheques are an electronic alternative to paper cheques and can be issued and deposited through online banking. Most banks offer free e-Cheque services.
• Debit/credit card transfers cost more than bank transfers because they incur additional charges imposed by the card provider.
• Over-the-counter or manual transfers are more expensive than online transactions.

A few things to remember about transaction fees:

• They vary from bank to bank (more on this later) and might be different for HKD and multi-currency accounts. Some Hong Kong banks also offer a fixed number of free transfers in a month.
• Foreign currency card transactions typically incur a conversion fee of 1.95-2.5%, which includes both the card association fee (Visa/MasterCard) and the bank's administrative fee.
• Giving standing instructions to banks for recurring payments incurs a fee. Amending your standing instructions application will cost extra.

3. Cheque-related charges

Banks charge fees to issue a cheque book, replenish it, or to issue another in case the first one is lost. However, the first cheque book, or even the first two, are usually free.

Banks also charge for processing cheques. And if your cheque bounces due to insufficient funds in your account or technical problems (wrong date or mismatched signature, etc), the bank charges a returned cheque fee,  typically ranging from HKD 150-300 per cheque. Stop payment instructions cost around HKD 100-150 per cheque. Requesting your bank to ‘mark’ a cheque – which means it is good for payment as soon as it is presented – incurs a marked cheque fee, typically costing HKD 100-200. 

4. Card-related charges

Some banks charge a small fee to issue a card or to replace a lost, stolen, or damaged card. Using your card at your bank’s ATM is free (with a daily transaction limit, of course) but using it at another bank’s ATM might incur a fee.

5. Digital services charges

There’s a monthly bank charge if you sign up for electronic alerts about your account or to receive information about trade finance tools (financial products/services targeted at importers and exporters to support international trade). This fee might be waived for the first few months.

6. Document-related charges

While paper statements are not the norm in the digital age, banks still provide printed account statements and certificates of balance on request, for a per-copy fee of course. The older the statements requested, the higher the fee. Banks also provide reference letters on request for a price. A reference letter is printed on the bank’s letterhead and confirms your account holder status as well as any financial information that is sought. Also, if you need your bank to confirm your financial information to your auditor, the bank will charge an audit confirmation fee.

Why do banks charge fees?

Banks charge fees and interest to cover operational costs and – like any other business – to earn a profit. Unlike payment service providers that exist solely in the digital space and provide digital business accounts at low to zero cost, banks need funds to maintain their significant physical infrastructure. The higher fees they charge also help banks offer their customers a wider range of products and services than their digital-first counterparts.

What are bank charges like in Hong Kong?

Hong Kong’s USD 3.3-trillion banking sector has robust representation from global and local players.  More than 70 of the largest 100 banks in the world have a presence, and over 29 multinational banks have their regional headquarters in Hong Kong. Hong Kong and Shanghai Banking Corporation (HSBC), Bank of China (Hong Kong), and Standard Chartered are the leading banks with significant presence in Hong Kong. Let’s take a look at their business account charges: 

1. HSBC Bank Charges

Founded in 1865 in Hong Kong, HSBC is the largest bank in Hong Kong and one of the territory's three note-issuing banks. HSBC offers various business account options. Here’s what HSBC bank charges look like:

• Account fee: Depending on the average monthly account balance, monthly fees can range from HKD 200-450 for BusinessVantage, Business Direct and Sprint Business account. 
• Fall-below fee: Ranges between HKD 200-300 per month if the account balance falls below the minimum average daily balance requirement (typically HKD 50,000). 
• Early account closure fee: Closing a business account within three months of its opening costs HKD 500. 
• Transaction fees: FPS transfers are free. Depending on whether the transaction is conducted online or at a branch, CHATS transfers cost HKD 75-200, telegraphic transfers cost HKD 150-250, while local interbank transfers can range between HKD 55-200. Cheque deposits are free. Cross-border RMB transfer fees start from HKD 100 depending on the destination.

2. Bank of China (Hong Kong)

Bank of China (Hong Kong) is one of Hong Kong's three note-issuing banks and serves as the clearing bank for Renminbi business in Hong Kong. A look at Bank of China’s bank charges:

• Account fee: Monthly fees range from HKD 100-200 for Business Integrated Account and Basic Business Account. Start-ups enjoy a special rate of HKD 80 per month in the first year. Fee waiver available with average daily balance of HKD 80,000.
• Fall-below fee: HKD 200 per month if the account balance falls below the minimum requirement (typically HKD 50,000). For balances between HKD 30,000-50,000, a reduced fee of HKD 100 applies. Start-ups benefit from a lower minimum balance requirement of HKD 10,000 in the first year.
• Early account closure fee: Closing a business account within six months of its opening costs HKD 500, with an additional HKD 150 charged per supplementary account. Fee waiver available for accounts closed due to business registration cancellation.
• Transaction fees: FPS transfers are free. CHATS transfers cost HKD 55-180 depending on online or branch transaction. Local interbank transfers range from HKD 30-130. Cash deposits are free up to HKD 30,000 per day, with a 0.25% charge thereafter. Bulk payment services cost HKD 8 per transaction, while e-cheque services are free.

3. Hang Seng Bank

A subsidiary of HSBC, Hang Seng Bank is one of Hong Kong's largest listed banks known for its comprehensive local business solutions. Let’s take a look at some of Hang Seng Bank charges: 

• Account fee: Monthly fees range from HKD 150-250 for Business Integrated Account and Smart Business Account. Start-up packages are available at HKD 100 per month for the first year. Fee waiver applies with a minimum 3-month average balance of HKD 100,000.
• Fall-below fee: HKD 200 per month if the account balance falls below HKD 50,000. A tiered structure applies with HKD 150 for balances between HKD 25,000-50,000, and HKD 200 for balances below HKD 25,000. Special considerations are available for seasonal businesses.
• Early account closure fee: Closing a business account within three months of its opening costs HKD 500, plus HKD 200 per supplementary account. An additional handling fee of HKD 100 applies for account documentation.
• Transaction fees: FPS transfers are free when conducted online. CHATS transfers range from HKD 75-200, while local interbank transfers cost HKD 35-150 depending on the channel used. Cash deposits are free up to HKD 35,000 per day, with a 0.25% charge thereafter. Bulk payment processing is charged at HKD 5 per transaction.

4. Standard Chartered Hong Kong Charges

Standard Chartered has been operating in Hong Kong since 1859 and is one of the territory's three note-issuing banks. Here's what Standard Chartered bank charges look like:

• Account fee: Monthly fees range from HKD 120-200 for BusinessOne and Standard Business accounts. SME packages are available at HKD 100 per month including digital services. Fee waiver applies with an average balance of HKD 100,000. Multi-currency accounts are available at no extra cost.
• Fall-below fee: HKD 200 per month if the account balance falls below HKD 50,000. A tiered structure applies with HKD 150 for balances between HKD 30,000-50,000, and HKD 200 for balances below HKD 30,000. Special arrangements are available for seasonal businesses.
• Early account closure fee: Closing a business account within six months of its opening costs HKD 500, plus HKD 200 for each supplementary account. A document handling fee of HKD 100 applies, though pro-rated refunds of prepaid annual fees are available.
• Transaction fees: FPS transfers are free for online transactions. CHATS transfers range from HKD 60-180, while local interbank transfers cost HKD 30-140 depending on the channel used. Cash deposits are free up to HKD 40,000 per day, with a 0.25% charge thereafter. Priority customers enjoy preferential rates on international transfers.
  

Same service, different bank charges

If you're considering opening a business account in Hong Kong, pay close attention to the bank charges. Not only are there multiple fees, but charges on some services might vary significantly between banks. For example, some banks charge an account opening fee while others waive it. Similarly, while most banks offer free FPS transfers, the fees for CHATS transfers and international remittances can vary considerably.

Fee differences also exist between different types of business accounts within the same bank. For instance, HSBC's BusinessVantage account has a monthly fee of HKD 200 and requires a minimum balance of HKD 50,000, while their Basic Business account has a lower monthly fee of HKD 150 with a reduced minimum balance requirement. Bank of China Hong Kong offers special concessions for start-ups, including a reduced monthly fee of HKD 80 and a lower minimum balance requirement of HKD 10,000 in the first year.

Packages of bundled services also cause fee variances. For example, Hang Seng Bank's Business Integrated Account offers preferential rates on foreign exchange transactions and free incoming telegraphic transfers, while their Basic Business account holders pay standard rates. Similarly, Standard Chartered's BusinessOne account holders enjoy preferential rates on trade services and international transfers compared to their standard business account customers.

Bank fee differences are influenced by various factors including operational costs, the range of additional services provided, competitive positioning in different market segments, and the inclusion of charges from financial service partners. For instance, banks with stronger mainland China connections like Bank of China (Hong Kong) often offer more competitive rates for RMB cross-border transfers, while banks with extensive international networks like HSBC and Standard Chartered might provide better rates for global transactions.

How to reduce your business account fees?

It’s not possible to bank for free, but there are certain charges you can avoid entirely while operating a business account in Singapore. Some tips:

• The fall-below fee is one bank charge that can be done away with completely. All you need to do is maintain the required daily or monthly minimum balance. This is easier said than done, considering that funds are tight for most small businesses. And that brings us to the next tip.
• Make sure to check the minimum balance requirements of multiple business accounts before settling on one. Requirements vary from account to account, bank to bank. Given that small and medium enterprises (SMEs) are an important part of Hong Kong’s business landscape, most banks have business accounts tailored to their needs. These SME-centric accounts not only have low or zero minimum balance requirements but also charge lower fees for other services.
• Keep track of your account balance to avoid paying excess fees. Having a linked account in the same bank is another solution to the overdraft problem. If one account falls short, the excess amount can be drawn from the linked account.

• Another easily avoidable bank charge expense is the inactivity fee. This monthly charge is deducted from your account and you’ll end up losing your money. It makes more sense to close the account and claim the money.
• Go paperless to avoid paying for physical bank statements and other documents.
• Check with your bank for a package deal. Bundling of services reduces operational costs, so the bank passes on the benefit to the account holder in the form of lower fees. A package subscription is also more convenient for the customer as they pay a monthly flat fee instead of paying for every single transaction.
• Finally, opt for a digital business account with a non-conventional banking partner like a fintech (financial technology) firm, digital bank, or payments service provider. This is a great way to reduce your bank charges expense. How? These non-bank alternatives offer comparatively lower fees with no hidden costs as well as competitive interest rates. They’re not limited to processing payments but are also in the business of lending to their customers. That’s not all, digital payment service providers are the byword for convenience. Opening an account is instantaneous – an Aspire Business Account takes just five minutes – while traditional bank accounts have a long verification process. They are easy to use and come with winning features such as a single platform for all your finances, regular alerts, and hassle-free accounting software integration, among others.

Digital-only business accounts are cost-effective, convenient

With Hong Kong's push toward fintech innovation, virtual banks and stored value facility (SVF) operators have emerged as viable alternatives to traditional banks. These digital-first institutions operate under licences from the Hong Kong Monetary Authority (HKMA) and offer services primarily through mobile apps and online platforms. With lower operational costs due to their branchless nature, they typically charge lower fees than traditional banks, making them particularly attractive to small businesses and start-ups.

Account opening fees and minimum balance requirements are generally lower or non-existent with virtual banks and SVF operators. Common charges include transaction fees for transfers, currency conversion fees, and card services. For example, virtual banks like ZA Bank, WeLab Bank, and Fusion Bank often offer free local transfers via FPS, competitive foreign exchange rates, and more flexible account opening requirements compared to traditional banks.

In Hong Kong, virtual banks operate under a dedicated banking licence issued by the HKMA, which allows them to take deposits and provide banking services, but with specific regulatory requirements different from traditional banks. Meanwhile, SVF operators function under a separate licencing regime that allows them to offer payment services and stored value facilities. Many of these digital providers partner with traditional licenced banks to offer additional financial services and ensure deposit protection under the Hong Kong Deposit Protection Scheme.

The integration with Hong Kong's faster payment system (FPS) and the ability to connect with mainland China's payment systems have made these digital providers particularly appealing to Hong Kong businesses. 

Keep charges low with Aspire Business Account

Don’t want bank charges to come in the way you do business? Try Aspire’s Business Account. It has no initial deposit and minimum balance requirements, and it comes with multi-currency accounts, payments and receivables management, expense management, credit lines, corporate cards, cashbacks, and multi-user access. It also integrates seamlessly with your accounting software.

Here’s what you don’t pay when you bank with Aspire:

• Account opening fee
• Fall-below fee
• Transaction fee for local transfers
• Corporate cards

And, you get more bang for your buck on these charges:

• International payments, which are four times cheaper than what banks offer 
• Market-leading foreign exchange rates in 30+ currencies across 130 countries
• Unlimited cashback on certain types of card spend

You can learn more about about Aspire’s pricing. Get started for free!