On 15th June 2016 the Parliament of Estonia introduced changes in the current legislation, making it easier to open a bank account in Estonia without visiting a bank branch. It is a welcome and anticipated change as the main obstruction keeping e-residents from doing business in Estonia, has been just that.

Currently, the identification of persons participating in a transaction or using a service must be performed while the person or their representative is in the same place with the bank representative. Under the new amendment identification by means of information technology solutions will be equivalent to in person identification.

The goal of the amendment is to make becoming an e-resident easier, make using e-services user-friendlier and offer e-residents and Estonian residents the opportunity to open a bank account without the need to visit the bank office.

The changes are equally beneficial for non-residents and Estonians who live and work abroad. The service is meant for any holder of the Estonian ID, digi-ID, or e-resident’s card.

The banks’ right to choose and limits

It is important to understand that the legislation allows for infotechnological facilities to be used for identification, but it is not compulsory. 

The banks’ reserve the right to decide whether or not they accept the application of e-residents. The credit and financial institutions also reserve the right to not provide any services or only provide them with limited service capacity.

Due to the fact the identification is done by infotechnological facilities, the legislation has set following conditions:

• The total amount of payments in one calendar month cannot exceed €10,000 for a natural person and €25,000 for a legal person.
• Banks have the obligation to cancel the long-term contract without providing the advance notice of the expiry of the term if:
  • The person does not appear at a place of residence or permanent establishment despite repeated requests.
  • The application for the e-residency permit is declined, it’s validity is stopped or it becomes invalid.

Opening bank account using video bridge

On 25th of October the Minister of Finance signed a regulation which determines the precise requirements and rules regarding opening a bank account without going to a bank office by using a real-time video bridge. The regulation is to come into force on Oct. 31.

The video bridge enables to check the applicant’s facial features against the photo on the ID and in the database of the Police and Border Guard Board may be used for identification and verification of identity. The bank representative will also conduct an interview with the applicant to determine his risk profile (background, origin of assets, purpose of establishing a business relationship). The whole process will be recorded and the recording archived.

If the applicant is a foreign national, it is acceptable to provide an ID (passport, driver’s license) issued by the country along with the digital e-residency identification.

However, banks will retain the right to identify a person by being at the same location as them.

When exactly the banks will come public with online identification solution is still not clear, but it is expected to happen during 2017.

Read more about How to open an Estonian bank account with the e-Residency card.