This is Closing 90% of Non-Resident’s Mercury Bank Accounts — Transcript

Full transcript

1. 0:00If in the last couple weeks you've woken
2. 0:01up to an email from Mercury Bank, which
3. 0:04is not a bank, it's a fintech company,
4. 0:05but woken up to an email from them
5. 0:06saying that we need information to
6. 0:08verify your account because we're
7. 0:09switching to a bank partner or your
8. 0:11account is being closed, you are not
9. 0:13alone. As someone who works with
10. 0:14international entrepreneurs and helps
11. 0:15them set up companies and bank accounts
12. 0:17and do everything the right way, which
13. 0:19lowers your chance of getting your
14. 0:20accounts closed, we've been encountering
15. 0:22this for our clients since they're
16. 0:23switching their partner banks. Now, they
17. 0:25had two partner banks before, now
18. 0:26they're switching to a different partner
19. 0:27bank. There's been different delays and
20. 0:28they've been doing it in tranches, but a
21. 0:30new tranche is happening and I've had a
22. 0:31number of clients who have gotten their
23. 0:33accounts closed or who have gotten
24. 0:35letters asking to verify their
25. 0:37transactions and their activities in
26. 0:38order to keep their accounts open. And
27. 0:39in this video, I'm going to go over some
28. 0:41of the letters that um my clients have
29. 0:43gotten, some of the notices, the emails
30. 0:44I mean, and I'm going to share to you
31. 0:46what we've done to try and get these
32. 0:48accounts reactivated and reopened. I'm
33. 0:50going to share some things that haven't
34. 0:52worked. I'm going to share some
35. 0:53alternatives and tell you what happens
36. 0:55if your accounts get closed and what you
37. 0:56should maybe go do going from there.
38. 0:58Now, Mercury's still a great
39. 1:00institution, a great company that gives
40. 1:02really cool tools for their banking, but
41. 1:03it's still a fintech bank. Their
42. 1:05customer service is still very limited
43. 1:06and it's still a very, very big
44. 1:08institution that has a lot of clients,
45. 1:10so you don't get that really good
46. 1:12customer service and in my opinion, my
47. 1:14experience, and a lot of it's automated,
48. 1:16so you need to make sure you provide the
49. 1:17right documentation when they request
50. 1:19it. Now, we've had no problem opening up
51. 1:21new Mercury accounts and getting those
52. 1:23verified and set up, but there's a lot
53. 1:24of people with old accounts that are
54. 1:25doing double verification on them
55. 1:27because they're switching banks and
56. 1:28Mercury really wants to see that you
57. 1:30have a US presence and US activity. So,
58. 1:32I'm going to share my screen now and I
59. 1:34have three different letters, so stay
60. 1:35there till the end and then I'll explain
61. 1:37what we can do for um what other options
62. 1:39I recommend based on your situation.
63. 1:41I'll go over a couple situations. As you
64. 1:42know, I'm an international tax CPA, I'm
65. 1:45a CPA in the US. I help a lot of people
66. 1:46expand their businesses to the US and
67. 1:48banking's a super important part of
68. 1:49that. Mercury is a great first option,
69. 1:51it's very easy to use, it has a lot of
70. 1:52great tools, but it's not good to only
71. 1:54have one bank set up because then if
72. 1:56they get closed, you're you're in
73. 1:57trouble. So, we want to make sure our
74. 1:59clients have at least a couple bank set
75. 2:00up backups, maybe physical banks in the
76. 2:02US, and generally the harder it is to
77. 2:04get an account open, the slower they're
78. 2:06going to close the account. The The
79. 2:07lower The harder the rules are for them
80. 2:08to get it closed. Fortunately, Mercury
81. 2:10is very easy to open for most people.
82. 2:12So, it's also one that can get closed
83. 2:14pretty easily. So, let me share my
84. 2:15screen, and let's look at a couple of
85. 2:17these different notices, and I'll
86. 2:18explain what we've been uh what my team
87. 2:20has been sharing as we support our
88. 2:21clients to hopefully keep their accounts
89. 2:23open. It's not working every time, but
90. 2:25we've had some success. So, I'm going to
91. 2:26share my entire screen here. Regarding
92. 2:28your account, please submit responses by
93. 2:30July 1st. Your progress will be saved
94. 2:32automatically. Let me get an update and
95. 2:33see what happened with this one
96. 2:33specifically. Please upload a recent
97. 2:35document to support the source of funds
98. 2:37for your account. Include the documents
99. 2:38to your name or your business name, and
100. 2:40they need to be supported by
101. 2:41corresponding transactional activity in
102. 2:43your account in order to be accepted.
103. 2:44Now, this is a really interesting thing
104. 2:46they're requesting, but a non-Mercury
105. 2:47bank statement is good. An invoice or a
106. 2:50contract reflecting your history. So, if
107. 2:52you have money going in, they want to
108. 2:53see They want to justify some of the
109. 2:55activity in the Mercury account. And
110. 2:57this is something that I've had some
111. 2:58clients get. And ideally, you have an
112. 3:01invoice, or you have a bank statement
113. 3:03from another country or something where
114. 3:04you sent funds from, or you have some
115. 3:06kind of confirmation for a transaction
116. 3:08that happened to your account. Now, this
117. 3:09is kind of a basic one. A payout summary
118. 3:12from Amazon. Like, this is kind of an
119. 3:14easier one. And you need to, you know,
120. 3:16give them the information they're asking
121. 3:17for as clearly as possible so that it
122. 3:20your account doesn't get shut down. Now,
123. 3:22that's the first one. Let's go to the
124. 3:23next letter. This is the the harder one.
125. 3:25To help verify your business operations
126. 3:27in the US, please provide one of the
127. 3:29documents listed below. Please note the
128. 3:31documentation may need to be supported
129. 3:32by corresponding transactional activity
130. 3:34in your Mercury account to be considered
131. 3:36acceptable. You can see at the bottom,
132. 3:38US operations are required to maintain
133. 3:39your Mercury account. If your business
134. 3:41is not currently operating in the United
135. 3:42States, or if you do not have
136. 3:44documentation that demonstrates current
137. 3:45US operations, please upload an
138. 3:47explanation with your current business
139. 3:48activities. Now, they're not saying um
140. 3:51you can't have a business that has no
141. 3:52activities, but they leave it open to
142. 3:54review and they're making this uh more
143. 3:56scrutinized and it's probably because of
144. 3:58their new partner bank, which they're
145. 3:59transitioning people over from. They
146. 4:00used to have two partner banks and I
147. 4:01think they're shifting to just one. I'm
148. 4:03not going to get into the the details
149. 4:05cuz I want to focus on just what we're
150. 4:06doing here. So, we've had our clients
151. 4:08our clients have sent bank statements,
152. 4:09different invoices, different contracts.
153. 4:11The only one that's kind of worked the
154. 4:13contractors that you pay in the US. Now,
155. 4:14I often uh advise my clients to avoid
156. 4:16having too many contractors or people in
157. 4:19the US that are working for you to avoid
158. 4:21being subject to US income taxation and
159. 4:23I'll touch on that how you can run these
160. 4:24and how the taxation should work a
161. 4:25little bit at the end, but essentially
162. 4:27you want to have someone in the US that
163. 4:29you're paying. Uh if you have a 3PL,
164. 4:30that would be a good invoice. For some
165. 4:32clients, they they get a contract with
166. 4:34some or they start paying someone and
167. 4:35get a contract with them, but having a
168. 4:37contract with someone you're paying is
169. 4:38generally the best option. If you don't
170. 4:40have that, record of sales made to US
171. 4:42customers can work, but that really
172. 4:43hasn't been working. We've had that get
173. 4:45rejected a lot. People have US
174. 4:46customers. If you have contractors, it's
175. 4:48better. That's what I'm trying to say.
176. 4:49If you have a contractor in the US,
177. 4:50that's a better option. If you have
178. 4:52sales from US-based customers, that's a
179. 4:54good option as well. Now, many people
180. 4:57outside the US, my audience and
181. 4:58non-residents, are using US LLCs and
182. 5:01Mercury accounts and operating online
183. 5:03digital businesses from outside of the
184. 5:04US and they're doing that because if you
185. 5:06don't have a presence in the US, you
186. 5:07don't have to pay US income taxes.
187. 5:09There's things you have to do to stay
188. 5:10compliant and I talk about that in my
189. 5:11other videos, but you don't actually
190. 5:12have to pay an income tax if you're not
191. 5:15doing business here. However, Mercury
192. 5:16wants to know you're doing some business
193. 5:18here uh to to this threshold in order to
194. 5:20maintain your account. So, that's kind
195. 5:22of the balancing act we're dealing with
196. 5:23as international entrepreneurs with US
197. 5:27bank accounts and US financial, um,
198. 5:28institutions. Mercury's not always like
199. 5:30this in their opening new accounts, but
200. 5:32this is for people you can see this is
201. 5:33request by July 18th. So, this is going
202. 5:35to be still pending. We've had a lot of
203. 5:37clients who have we've submitted a
204. 5:38number of different things and they're
205. 5:39not getting approved, so we're going to
206. 5:40back up banks, but the only things that
207. 5:42really have been working are contracts
208. 5:44with US contractors. Having US clients
209. 5:46hasn't been helping, but obviously
210. 5:48submit whatever you can and push back.
211. 5:50This is mostly automated, so you want to
212. 5:53make it as clean as possible cuz they're
213. 5:54not like generally reviewing this on so
214. 5:56you have to put the attachments in. And
215. 5:58then if you don't send the right thing,
216. 6:00this is the letter you'll get. Our team
217. 6:01has reviewed the previously provided
218. 6:03documentation and unfortunately we're
219. 6:04unable to accept it as proof of US
220. 6:06operations. To verify your business,
221. 6:08please provide the the documents listed
222. 6:10below. So they want to show you have
223. 6:12employees based in the US. And this is
224. 6:13the most specific things. And responding
225. 6:15to this letter, this is more detailed.
226. 6:17So you maybe you look at this one before
227. 6:18you send the response. Pause it if you
228. 6:20want. But they want to see you have
229. 6:21employees based in the US, which you
230. 6:22won't. You won't have employment
231. 6:23agreements, we'll have non-employee
232. 6:25contracts because if you have employees,
233. 6:27there's a difference between a
234. 6:28contractor and an employee. If you have
235. 6:30contractors, it's fine for taxes. If you
236. 6:32have employees, you have a lot of US
237. 6:34income tax risk. If you do, then that's
238. 6:36easy to get your account approved, but
239. 6:37it's generally you're probably paying
240. 6:38taxes or have a corporation or
241. 6:40something. But if you are most like most
242. 6:42of the people watching the video, you
243. 6:43might have a contractor in the US. You
244. 6:45might need to get one and say it's a new
245. 6:47contract that you're going to be paying.
246. 6:49And that can work. That's worked for
247. 6:50some clients like I said. The office
248. 6:51leases haven't really been working. Um
249. 6:53even if you have a different lease or
250. 6:56proof of occupancy of a co-working
251. 6:57space, we've taken pictures for clients,
252. 6:59we've sent lease documents to clients.
253. 7:00Utility bills will probably work, but
254. 7:02it's hard. I I rent office spaces and I
255. 7:03don't even get utility bills for my
256. 7:05office spaces. Everything's included in
257. 7:06the lease. So I generally that hasn't
258. 7:09really been working for most of our
259. 7:10clients even if they have like a a
260. 7:12residential address or something. It's
261. 7:13it's not they haven't really been
262. 7:15accepting those as much. But again, it's
263. 7:17better than nothing. And then the last
264. 7:18one is if you have customers, partners,
265. 7:20vendors, or suppliers in the US.
266. 7:21Anything you can send is going to be
267. 7:23better than nothing, but they've been
268. 7:25really strict about these. Part of me
269. 7:27making this video so I can get comments
270. 7:28from you guys to see what you've done to
271. 7:30get this approved. So please comment
272. 7:32below if you've gone through this
273. 7:33process and you've gotten your account
274. 7:35approved and let everyone else know what
275. 7:37you've been doing to keep your account
276. 7:38open. I've like I said, it's mostly the
277. 7:40contractors agreements that have been
278. 7:42working, having sales agreements to
279. 7:43clients, having other contractors,
280. 7:45having lease agreements. We've been
281. 7:46trying a lot of stuff for different
282. 7:47clients, and some of those just aren't
283. 7:49working. The only one that is working,
284. 7:50and only sometimes, is the contractor
285. 7:52agreement. Now, what happens if you
286. 7:53can't get this done? Mercury is not
287. 7:55going to keep your money. They might
288. 7:56close your account, and they'll say,
289. 7:57"Where do you want to send your money?"
290. 7:59You should probably open a backup
291. 8:00account if you don't already have one.
292. 8:01There's good online options if you
293. 8:03qualify for them. Relay Fi has closed a
294. 8:06bunch of accounts in the past. They've
295. 8:07been annoying, but it's it's a decent
296. 8:08one to have. They've been pretty clean
297. 8:10and up boarding. What we do, Slash, is
298. 8:11very popular. Revolut is really
299. 8:13expanding their US operations a lot.
300. 8:15I've done other videos about Lili's been
301. 8:17cool. They're trying to They're a little
302. 8:19bit more restrictive. Wise, if you can
303. 8:21get it open, Wise has been tough as
304. 8:22well. And then, Airwallex, if you can
305. 8:24get it open. There's There's a lot of
306. 8:25accounts. I had the another video a
307. 8:27couple weeks ago I did where I ranked
308. 8:29like 30 different banks, all the banks
309. 8:30we've worked with. Check that video out
310. 8:32if you want to see like a number of
311. 8:33different banks and things you haven't
312. 8:34heard of or different examples. There's
313. 8:36always a new financial institution out
314. 8:37there and a new way to do it. But, we
315. 8:39want to get something that has the tools
316. 8:40we need, has a good reputation, looks
317. 8:42good for our clients when they're
318. 8:43sending us money, and is easy to work
319. 8:44with. Unfortunately, Mercury is closing
320. 8:46a lot of accounts. But, for new people,
321. 8:48we're still able to get a lot of
322. 8:49accounts open. I don't think they're
323. 8:50going to be shifting partner banks all
324. 8:52the time. It's quite a hassle for them,
325. 8:53and it's a hassle for all their clients.
326. 8:55So, I don't think this is going to
327. 8:56happen a lot. But, if you are in the
328. 8:57situation, you need extra help, you want
329. 9:00to get our advice, you want us to help
330. 9:01you set up new accounts, need
331. 9:02introductions to physical banks,
332. 9:03traditional banks, better addresses,
333. 9:05help to do your US compliance to make
334. 9:07sure you're not paying taxes and doing
335. 9:08it all the right way, I'd encourage you
336. 9:10to click the link below and schedule a
337. 9:11free call with me and the team. This is
338. 9:12what we do. We help international
339. 9:14entrepreneurs expand to the US the right
340. 9:16way, make sure they're not paying any
341. 9:17taxes, they're fully compliant, and they
342. 9:18have the best options for financial bank
343. 9:20accounts and things available to them.
344. 9:22Hopefully, this was helpful. Please
345. 9:23guys, comment. Let me know what you did
346. 9:24if this happened to you and what you've
347. 9:25done to get your account approved and
348. 9:27fixed. And I look forward to hearing
349. 9:28from you. Hopefully, this helps out some
350. 9:30people. See you in the next video.