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Interpolitan Money

Overseas Direct Investment – A Global Bank Account Saga


Are you an Indian Exporter or Importer that has struggled to open bank accounts for your offshore venture? Join the list of many such Small & Medium Enterprises in India that are starved of banking facilities overseas. While they have a business model & need to set-up an offshore subsidiary or joint venture, they struggle to get banking facilities such as a current account.


According to World Bank, SMEs globally represent 90% of the businesses and 50% of employment. In emerging economies, SMEs contribute as high as 60% of the total GDP. As per World Bank estimates, 600 million jobs will be required by 2030 to absorb growing global workforce, which makes SMEs significant for policy makers to pay attention. Today, an SME creates 7 out of 10 jobs in the world however they are under served as compared to what they bring to the table. Especially banking.


Overseas banking is a complicated subject. While one may have offshore clients who is buying from an Indian exporter & many may assist with introductions to offshore banks, Indian SMEs are unable to garner banking support due to various reasons such as size, scale, documentation & risk appetite. Despite these challenges, many SMEs are beginning to register companies overseas to ease trading.


Let’s look at how Indian SMEs contribute to country’s growth:

  1. 40% of the total exports

  2. 40% of the GDP

  3. 45% of the total industrial production

  4. 30% of the total employment in the country

SME contribution is significant. Are they served significantly? Let’s look at some indicators:

  1. Enjoys only 16% of the total banking credit

  2. 85% of SMEs remain underserved in terms of credit & finance requirements

  3. Talent pool attracted by SMEs continue to remain poor.

  4. Benefits of formalisation continue to stay elusive for SMEs as the cost of capital remains high

Source : Ministry of Commerce, RBI


Many SMEs struggle to open bank accounts offshore because their Indian banks do not have branches or partnerships abroad and thus SMEs end up relying on their network of the consultants who may have handled such situations before. Often, the consultant relies on relationships with banks that have been most helpful on a specific transaction. There’s no guarantee that service levels will continue to be the same as the previous transaction.


Global Neo Banks have increased their focus on paperless & digital on-boarding of clients thus supporting an unbiased pay per use sort of structures to provide bank accounts. What is often missed is the level of service or trust in these structures.


At Interpolitan, we serve clients with a relationship approach first & then provide solutions that are agnostic to the size of the business but is revenue accretive to both parties. We are the space in between ambition & success.

To find out more please reach us at banking@interpolitanmoney.com

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