From no questions to twenty-five pages: why does opening a business bank account take so long?

Stefan Sluijter, founder and CEO of Solance, argues that business banking has changed from almost no scrutiny to twenty-five-page onboarding packs and months-long waits, and that the real fix isn't more paperwork, but better judgement at the front of the process. 

Early in my career, opening a business bank account was only a phone call away. We rang the bank, asked for a list of account numbers, and promised to let them know which company we had allocated each one to within the first three months of operations. That was the whole arrangement. When EUR 25,000 needed to move from a company in Luxembourg to one in Hong Kong, we logged the payment, and it went through. No questions asked. Nobody thought twice about it, because that was simply how the industry operated back then.

I spent the best part of twenty years in financial services, sitting right between banks and the businesses that depend on them to access the system. From that position, I watched that entire way of working come to an end.

To be fair, there was a reason things changed. Banks had to get much better at knowing who they were dealing with and where money came from. After seeing what could move through the financial system when nobody was looking closely, I can hardly argue with that.

From no questions to twenty-five pages of them

The problem is, we’ve gone straight from one extreme to the other. The onboarding pack a business must complete today often runs to well over twenty-five pages. Certified, notarised copies of virtually every document you can think of, followed by an onboarding process that can easily drag on for six months.

You end up with newly incorporated companies sitting there with suppliers to pay and invoices that should have gone out weeks ago. They’re fully ready to trade, but everything is on hold simply because the account isn't live yet.

The model above the checks

The paperwork is frustrating, but it isn't really what bothers me most.

Every bank has a risk model, an internal system for deciding who gets an account and who doesn't. Those models must handle large volumes of applications, so they naturally favour things that are easy to classify.

The incentives are lopsided, though. If a bank gets it wrong and takes on the wrong client, it can face millions in fines and a serious hit to its reputation. If it rejects a perfectly legitimate business, there usually isn't the same immediate consequence. From the bank's point of view, that makes the cautious option very easy to choose. Given that incentive, the model does what any model would do: it treats everything outside the standard profile as a cost to be avoided.

A holding company in a tax-efficient jurisdiction is a good example. Its location alone tells you very little about the people behind it. The same applies to a firm sourcing materials from Turkey or Malaysia. That doesn't automatically make it dangerous simply because the supplier is overseas. Perhaps, models do not always make those distinctions effectively without the right context and human judgement.

From there, the onboarding teams must wade through the backlog layer by layer. And every single layer adds another few weeks to the wait.

What happens while you wait

Turning companies down is only half the story. The businesses that remain stuck in the pipeline are where the damage becomes obvious. Working capital sits idle while signed contracts wait for a first payment. Some of those opportunities do not come back.

There is also a wider problem. When transparent, legitimate businesses struggle to get access through regulated channels, their money does not stop moving. It finds channels that are harder to see. The European Banking Authority warned about exactly this in its 2022 opinion on de-risking. Pushing lawful business out of the regulated system makes money flows harder to follow, and that is the opposite of what all this control was meant to achieve.

Where judgement comes in

When systems, data and processes are fragmented, the gaps get filled with paper, and twenty-five pages of questions is the symptom of exactly that.

The right questions, asked by people who understand the business in front of them, produce a sharper assessment from far less paper.

So, it starts with who does the assessing.

Put experienced people at the front of onboarding, people who can read an ownership structure and a flow of funds and recognise what is normal for that type of business. Then trust them to decide, supported by clear escalation criteria and independent second-line oversight and challenge where the risk is genuinely elevated.

Flatten the layers while you are at it, because a decision that crawls across five desks was never going to be a quick one.

Technology isn't really the problem either.  Much of the paperwork that institutions still request from their clients can be obtained on their behalf, from reliable and independent sources. Screening and monitoring tools have come a long way too, particularly with what AI can now do to support the process. Legacy systems explain why parts of the market are slow to adopt them. They do not justify it. And clients will meet the industry halfway. An organisation with entities in four jurisdictions understands that its assessment takes more work than the local butcher's. What it will not accept is silence, a file sitting in a queue for months with nobody able to say where things stand.

None of this lowers the standard; it raises it. Robust AML/CFT/PF and sanction controls, combined with better data, technology and experienced human judgement, let a genuinely risk-based approach identify higher-risk relationships more effectively whilst avoiding unnecessary friction for businesses.

Business has been global for decades. A risk model that treats operating across borders as a red flag no longer fits the world it is supposed to assess. And every year it cuts more legitimate companies out of the system it was built to protect.

That should worry the industry more than it seems to. De-risking does not remove risk. It moves money to places where no one can see it.

About the author

 

Stefan Sluijter is the founder and CEO of Solance. He spent almost twenty years in financial services, setting up and maintaining international corporate structures and arranging the bank accounts that came with them. He founded Solance in 2024.

 

About Solance

Solance is building a corporate payments platform for organisations that operate across multiple entities, jurisdictions and currencies. It is designed for family offices, corporate service providers and businesses operating across borders. Based in Dublin, Solance is currently undergoing the authorisation process with the Central Bank of Ireland as an Electronic Money Institution.