banking
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| banking [2025/11/01 09:03] – [FATCA and FBAR] jhagstrand | banking [2025/11/24 21:49] (current) – jhagstrand | ||
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| ====== Banking ====== | ====== Banking ====== | ||
| + | |||
| + | [[American Expat Retiree Financials | contents]] | ||
| Number of FDIC-insured banks in the US in 2024: 4500\\ | Number of FDIC-insured banks in the US in 2024: 4500\\ | ||
| Number of federally-insured credit unions in the US in 2024: 4600 | Number of federally-insured credit unions in the US in 2024: 4600 | ||
| - | === Financial Services === | + | == Financial Services == |
| - | + | ||
| - | * Banking (Retail, Commercial, Investment)\\ | + | |
| - | + | ||
| - | * Investment Services (Asset Management, Brokerage, Venture Capital)\\ | + | |
| - | + | ||
| - | * Insurance (Life, Health, Property, Casualty, Reinsurance)\\ | + | |
| - | + | ||
| - | * Risk Management (Derivatives, | + | |
| - | + | ||
| - | * Financial Planning and Advisory\\ | + | |
| - | + | ||
| - | * Payment and Transaction Services\\ | + | |
| - | + | ||
| - | * Specialized Services like Microfinance, | + | |
| - | + | ||
| - | * Regulatory and Compliance Services\\ | + | |
| + | * Banking (Retail, Commercial, Investment) | ||
| + | * Investment Services (Asset Management, Brokerage, Venture Capital) | ||
| + | * Insurance (Life, Health, Property, Casualty, Reinsurance) | ||
| + | * Risk Management (Derivatives, | ||
| + | * Financial Planning and Advisory | ||
| + | * Payment and Transaction Services | ||
| + | * Specialized Services like Microfinance, | ||
| + | * Regulatory and Compliance Services | ||
| * FinTech innovations | * FinTech innovations | ||
| - | === Types of Banks === | + | == Types of Banks == |
| * Retail Bank | * Retail Bank | ||
| - | * checking, savings\\ | + | * checking, savings |
| - | + | * debit cards, credit cards | |
| - | * debit cards, credit cards\\ | + | * for individuals |
| - | + | ||
| - | * for individuals\\ | + | |
| * Commercial Bank | * Commercial Bank | ||
| - | * includes retail banking, plus\\ | + | * includes retail banking, plus |
| - | + | * Lending: Providing loans to individuals (mortgages, personal loans) and businesses (commercial loans) | |
| - | * Lending: Providing loans to individuals (mortgages, personal loans) and businesses (commercial loans)\\ | + | * Payment Services: handling transactions, |
| - | + | * for individuals and businesses | |
| - | * Payment Services: handling transactions, | + | |
| - | + | ||
| - | * for individuals and businesses\\ | + | |
| * Investment Bank | * Investment Bank | ||
| - | * raising capital\\ | + | * raising capital |
| - | + | * advising on complex financial transactions | |
| - | * advising on complex financial transactions\\ | + | * trading securities |
| - | + | * for corporations, | |
| - | * trading securities\\ | + | |
| - | + | ||
| - | * for corporations, | + | |
| * Global Bank | * Global Bank | ||
| - | * a commercial bank that operates in multiple countries and can therefore offer payment and transaction services across national borders.\\ | + | * a commercial bank that operates in multiple countries and can therefore offer payment and transaction services across national borders. |
| * Universal Bank | * Universal Bank | ||
| * provides all of the financial services listed above under one roof | * provides all of the financial services listed above under one roof | ||
| - | a bank in America requires a residence in America. true? not necessarily | + | ===== Global Banks ===== |
| - | Global banking ?\\ | + | == HSBC == |
| - | Local banking USA\\ | + | |
| - | Local banking Thailand | + | |
| - | + | ||
| - | I currently have two retail bank accounts: Chase checking and Citi credit card.\\ | + | |
| - | I need them to be global | + | |
| - | + | ||
| - | ====== Global Banks ====== | + | |
| - | + | ||
| - | === HSBC === | + | |
| https:// | https:// | ||
| Line 76: | Line 49: | ||
| * Basic | * Basic | ||
| - | * minimum balance: 0\\ | + | * minimum balance: 0 |
| - | + | * foreign trx fee: 3% | |
| - | * foreign trx fee: 3%\\ | + | |
| * Choice: | * Choice: | ||
| - | * minimum balance: $1500\\ | + | * minimum balance: $1500 |
| - | + | * foreign trx fee: 3% | |
| - | * foreign trx fee: 3%\\ | + | |
| * Premiere: | * Premiere: | ||
| - | * minimum balance: $100,000\\ | + | * minimum balance: $100,000 |
| * foreign trx fee: 0% | * foreign trx fee: 0% | ||
| - | === Charles Schwab | + | == Charles Schwab == |
| Investor Checking account, must be linked to a Schwab One Brokerage account: | Investor Checking account, must be linked to a Schwab One Brokerage account: | ||
| - | * Refunds on all ATM fees worldwide.\\ | + | * Refunds on all ATM fees worldwide. |
| - | + | * No foreign transaction fees. | |
| - | * No foreign transaction fees.\\ | + | * Account earns interest. |
| - | + | ||
| - | * Account earns interest.\\ | + | |
| * No minimum balance requirement and no monthly fee. | * No minimum balance requirement and no monthly fee. | ||
| Line 106: | Line 71: | ||
| Note: Schwab acquired TD Ameritrade in 2020, complete in May 2024. | Note: Schwab acquired TD Ameritrade in 2020, complete in May 2024. | ||
| - | === eTrade | + | == eTrade == |
| from Morgan Stanley Private Bank\\ | from Morgan Stanley Private Bank\\ | ||
| Line 114: | Line 79: | ||
| No transaction fee for online wire transfer. | No transaction fee for online wire transfer. | ||
| - | ====== International money transfer businesses | + | ===== International money transfer businesses ===== |
| Examples: | Examples: | ||
| - | * Revolut\\ | + | * Revolut |
| - | + | * WorldRemit | |
| - | * WorldRemit\\ | + | * Xoom |
| - | + | ||
| - | * Xoom\\ | + | |
| * Azimo | * Azimo | ||
| - | === Wise === | + | == Wise == |
| Started as TransferWise by two guys from Estonia.\\ | Started as TransferWise by two guys from Estonia.\\ | ||
| Line 136: | Line 98: | ||
| Wise offers three products: | Wise offers three products: | ||
| - | * Wise Account - let customers open accounts to hold, send, receive, and spend money.\\ | + | * Wise Account - let customers open accounts to hold, send, receive, and spend money. |
| - | + | * Wise Business - allows businesses to perform cross-border money transfers. | |
| - | * Wise Business - allows businesses to perform cross-border money transfers.\\ | + | |
| * Wise Platform - a platform allowing “banks and businesses to offer their customers fast, cheap and transparent ways to manage their money across borders”. | * Wise Platform - a platform allowing “banks and businesses to offer their customers fast, cheap and transparent ways to manage their money across borders”. | ||
| Line 145: | Line 105: | ||
| A customer may open an account to hold money while sending, receiving, and spending. Customers may: | A customer may open an account to hold money while sending, receiving, and spending. Customers may: | ||
| - | * opt-in to earn interest on the account, and\\ | + | * opt-in to earn interest on the account, and |
| * gain FDIC insurance on up to $250,000 of their deposit. | * gain FDIC insurance on up to $250,000 of their deposit. | ||
| Line 155: | Line 114: | ||
| Transfer money into your Wise account via: | Transfer money into your Wise account via: | ||
| - | * Bank Transfer\\ | + | * Bank Transfer |
| - | + | * Debit Card | |
| - | * Debit Card\\ | + | * Credit Card |
| - | + | * Simple Bank Transfer | |
| - | * Credit Card\\ | + | * iDEAL - from your online banking |
| - | + | * Trustly - for Finland and Estonia | |
| - | * Simple Bank Transfer\\ | + | |
| - | + | ||
| - | * iDEAL - from your online banking\\ | + | |
| - | + | ||
| - | * Trustly - for Finland and Estonia\\ | + | |
| * Your Balance - instant | * Your Balance - instant | ||
| - | ====== Thin Tech Banks ====== | + | ===== Thin Tech Banks ===== |
| Example | Example | ||
| Line 178: | Line 131: | ||
| though he works with entrepreneurs, | though he works with entrepreneurs, | ||
| - | ====== Online Bank Accounts | + | ===== Online Bank Accounts ===== |
| Examples | Examples | ||
| - | * Ally\\ | + | * Ally |
| * Chime | * Chime | ||
| Line 189: | Line 141: | ||
| These banks are NOT global. They require a US address. | These banks are NOT global. They require a US address. | ||
| - | === US Direct Express | + | == US Direct Express == |
| https:// | https:// | ||
| Line 195: | Line 147: | ||
| I think it requires a US address | I think it requires a US address | ||
| - | ====== Travel Credit Cards ====== | + | ===== Travel Credit Cards ===== |
| The foreign exchange rate is a function of the network (Visa or Mastercard), | The foreign exchange rate is a function of the network (Visa or Mastercard), | ||
| - | === Chase Sapphire Preferred | + | == Chase Sapphire Preferred == |
| The Chase Sapphire “unpreferred” version is no longer available to new applicants. | The Chase Sapphire “unpreferred” version is no longer available to new applicants. | ||
| - | * annual fee: $95\\ | + | * annual fee: $95 |
| * no foreign transaction fees | * no foreign transaction fees | ||
| - | === Citi Strata Premiere | + | == Citi Strata Premiere == |
| Previously Citi Premiere, the “Strata” was added in mid 2024. | Previously Citi Premiere, the “Strata” was added in mid 2024. | ||
| - | * annual fee: $95\\ | + | * annual fee: $95 |
| * no foreign transaction fees | * no foreign transaction fees | ||
| - | ====== FATCA and FBAR ====== | + | ===== FATCA and FBAR ===== |
| + | |||
| + | [Editor: this info does not belong on this page. This page is about American banking. | ||
| Two different requirements for taxpayers to report foreign holdings. | Two different requirements for taxpayers to report foreign holdings. | ||
| + | |||
| - must file IRS form 8938 if he has more than $200,000 of foreign assets. | - must file IRS form 8938 if he has more than $200,000 of foreign assets. | ||
| * per Foreign Account Tax Compliance Act (FATCA) of 2010 | * per Foreign Account Tax Compliance Act (FATCA) of 2010 | ||
| Line 227: | Line 180: | ||
| * Department of the Treasury | * Department of the Treasury | ||
| - | | + | Note. The Thai retirement visa requires 25,000 in a Thai bank.\\ |
| - | If an expat living in Thailand keeps between $25K and $200K in Thai banks, he must file an FBAR but not | + | If an expat living in Thailand keeps between $25K and 200K in Thai banks, he must file an FBAR but not IRS 8938 (FATCA). |
| - | | + | |
| - | === Summary of FATCA reporting for U.S taxpayers | + | == Summary of FATCA reporting for U.S taxpayers == |
| https:// | https:// | ||
| Line 240: | Line 192: | ||
| * must file an income tax return | * must file an income tax return | ||
| * not married filing jointly | * not married filing jointly | ||
| - | * more than $200,000 on the last day of the tax year or more than $300,000 at any time during the year | + | * more than $200,000 on the last day of the tax year or more than 300,000 at any time during the year |
| The rules are different for taxpayers living in the US and for non-citizens. | The rules are different for taxpayers living in the US and for non-citizens. | ||
| - | === Comparison of Form 8938 and FBAR requirements | + | == Comparison of Form 8938 and FBAR requirements == |
| https:// | https:// | ||
| Line 250: | Line 202: | ||
| FBAR Form 114 is filed online thru FinCEN, even if you don’t have to file a tax return.\\ | FBAR Form 114 is filed online thru FinCEN, even if you don’t have to file a tax return.\\ | ||
| IRS Form 8938 is filed along with tax return.\\ | IRS Form 8938 is filed along with tax return.\\ | ||
| - | Thresholds: FBAR $10K, FATCA $200K. | + | Thresholds: FBAR $10K, FATCA 200K. |
| - | === === | + | == Requirements for Financial Institutions == |
| - | + | ||
| - | === Requirements for Financial Institutions | + | |
| FATCA and BSA both put requirements on financial institutions to investigate and report customers who have foreign holdings. | FATCA and BSA both put requirements on financial institutions to investigate and report customers who have foreign holdings. | ||
| Line 262: | Line 212: | ||
| https:// | https:// | ||
| - | ====== Payment Systems | + | ===== Payment Systems ===== |
| Summary | Summary | ||
| - | * Wire transfer is international, | + | * Wire transfer is international, |
| - | + | * Paypal is international. | |
| - | * Paypal is international.\\ | + | * ACH is USA only, and usually requires an external account setup with micro-deposit verification. |
| - | + | ||
| - | * ACH is USA only, and usually requires an external account setup with micro-deposit verification.\\ | + | |
| * P2P systems are unique to specific national markets, and the USA ones have security and privacy faults. | * P2P systems are unique to specific national markets, and the USA ones have security and privacy faults. | ||
| - | ===== Automated Clearing House (ACH) ===== | + | ==== Automated Clearing House (ACH) ==== |
| National ACH association (NACHA)\\ | National ACH association (NACHA)\\ | ||
| Line 281: | Line 228: | ||
| Also known as | Also known as | ||
| - | * direct debit,\\ | + | * direct debit, |
| - | + | * EFT, | |
| - | * EFT,\\ | + | * electronic bank transfer and |
| - | + | ||
| - | * electronic bank transfer and\\ | + | |
| * eCheck. | * eCheck. | ||
| Line 293: | Line 237: | ||
| ACH payments can be processed | ACH payments can be processed | ||
| - | * in a matter of hours\\ | + | * in a matter of hours |
| - | + | * on the same business day, or | |
| - | * on the same business day, or\\ | + | * scheduled the following day |
| - | + | ||
| - | * scheduled the following day\\ | + | |
| * or two business days away. | * or two business days away. | ||
| Line 306: | Line 247: | ||
| The ACH Network | The ACH Network | ||
| - | * is open for processing payments 23¼ hours every business day.\\ | + | * is open for processing payments 23¼ hours every business day. |
| * settles payments four times a day | * settles payments four times a day | ||
| * when the Federal Reserve’s settlement service is open: | * when the Federal Reserve’s settlement service is open: | ||
| - | * 7:30am to 6:30pm ET M-F\\ | + | * 7:30am to 6:30pm ET M-F |
| * closed on federal holidays | * closed on federal holidays | ||
| - | === Micro Deposit Verification | + | == Micro Deposit Verification == |
| At Chase Bank, and at CalCoast, the customer first creates an “external account”, which is presumed to be an account at another bank, owned by that same customer. The bank makes two deposits, each under one dollar, and the customer can prove that he has access to the external account by calling out the values of the two micro deposits. After this he can make ACH payments to that account. | At Chase Bank, and at CalCoast, the customer first creates an “external account”, which is presumed to be an account at another bank, owned by that same customer. The bank makes two deposits, each under one dollar, and the customer can prove that he has access to the external account by calling out the values of the two micro deposits. After this he can make ACH payments to that account. | ||
| Line 320: | Line 259: | ||
| Can he also make withdrawals from that account? YES. Unless one of the two banks has some restrictions in place. Therefore, ACH is suitable only for use among one’s own personal accounts. | Can he also make withdrawals from that account? YES. Unless one of the two banks has some restrictions in place. Therefore, ACH is suitable only for use among one’s own personal accounts. | ||
| - | ===== Wire Transfer | + | ==== Wire Transfer ==== |
| Sent electronically across a network of banks or transfer agencies around the world. | Sent electronically across a network of banks or transfer agencies around the world. | ||
| Line 328: | Line 267: | ||
| Sender must provide: | Sender must provide: | ||
| - | * amount transferred\\ | + | * amount transferred |
| * The recipient’s | * The recipient’s | ||
| - | * name,\\ | + | * name, |
| - | + | * address, and | |
| - | * address, and\\ | + | * contact number, along with |
| - | + | * any other personal information required to facilitate the transaction | |
| - | * contact number, along with\\ | + | |
| - | + | ||
| - | * any other personal information required to facilitate the transaction\\ | + | |
| * The recipient’s banking information, | * The recipient’s banking information, | ||
| - | * account number and\\ | + | * account number and |
| - | + | * branch number | |
| - | * branch number\\ | + | |
| * The receiving bank’s information, | * The receiving bank’s information, | ||
| - | * institution’s name,\\ | + | * institution’s name, |
| - | + | * address, and | |
| - | * address, and\\ | + | * bank identifier (routing number or SWIFT code) |
| - | + | ||
| - | * bank identifier (routing number or SWIFT code)\\ | + | |
| * The reason for the transfer | * The reason for the transfer | ||
| Line 359: | Line 288: | ||
| International wires take up to 5 days. It takes longer because it has to clear the USA ACH and the equivalent in the receiving country. Delays of up to 3 weeks are not unheard of. | International wires take up to 5 days. It takes longer because it has to clear the USA ACH and the equivalent in the receiving country. Delays of up to 3 weeks are not unheard of. | ||
| - | === Western Union === | + | == Western Union == |
| A non-bank money transfer made through a private network. Faster. | A non-bank money transfer made through a private network. Faster. | ||
| - | ===== PayPal | + | ==== PayPal ==== |
| International.\\ | International.\\ | ||
| Line 376: | Line 305: | ||
| faxzero.com only takes paypal | faxzero.com only takes paypal | ||
| - | ===== P2P Payment Systems | + | ==== P2P Payment Systems ==== |
| Person to Person Payment Apps: | Person to Person Payment Apps: | ||
| - | * Zelle - US only\\ | + | * Zelle - US only |
| - | + | * Venmo - US and dabbling in Mexico | |
| - | * Venmo - US and dabbling in Mexico\\ | + | * Apple Cash - US only |
| - | + | * Cash App - US only | |
| - | * Apple Cash - US only\\ | + | * WeChat - China |
| - | + | * AliPay - China | |
| - | * Cash App - US only\\ | + | * Revolut - Europe, U |
| - | + | ||
| - | * WeChat - China\\ | + | |
| - | + | ||
| - | * AliPay - China\\ | + | |
| - | + | ||
| - | * Revolut - Europe, U\\ | + | |
| * Paytm - India | * Paytm - India | ||
| - | === Consumer Reports finds consumer risks === | + | == Consumer Reports finds consumer risks == |
| https:// | https:// | ||
| - | === === | + | == Plaid bank connection system fraud == |
| - | + | ||
| - | === Plaid bank connection system fraud === | + | |
| Plaid connects software to banking systems.\\ | Plaid connects software to banking systems.\\ | ||
| Powered by plaid: | Powered by plaid: | ||
| - | * venmo\\ | + | * venmo |
| - | + | * robinhood | |
| - | * robinhood\\ | + | * acorns |
| - | + | ||
| - | * acorns\\ | + | |
| * AdvicePay | * AdvicePay | ||
| Line 420: | Line 337: | ||
| https:// | https:// | ||
| - | === Send money to an email address. | + | == Send money to an email address. == |
| Example. Glenn Reeves asks for money for his 1040 excel spreadsheet, | Example. Glenn Reeves asks for money for his 1040 excel spreadsheet, | ||
| Line 443: | Line 360: | ||
| (Send to: @Glenn-Reeves-2 ) | (Send to: @Glenn-Reeves-2 ) | ||
| - | ====== Credit Unions | + | ===== Credit Unions ===== |
| Credit Unions can offer services similar to banks, including checking, savings, debit card, credit card, and various credit and loan products. | Credit Unions can offer services similar to banks, including checking, savings, debit card, credit card, and various credit and loan products. | ||
| Line 451: | Line 368: | ||
| Federally chartered credit unions in the US are regulated and supervised by the National Credit Union Administration, | Federally chartered credit unions in the US are regulated and supervised by the National Credit Union Administration, | ||
| - | === State Department Federal Credit Union (SDFCU) | + | == State Department Federal Credit Union (SDFCU) == |
| https:// | https:// | ||
| [[https:// | [[https:// | ||
banking.1762002190.txt.gz · Last modified: 2025/11/01 09:03 by jhagstrand