Virtual IBAN accounts for businesses – pay fewer account fees
- International payments
- International business
A virtual IBAN account is a game changer for businesses that conduct worldwide transactions. Instead of using the expensive SWIFT network, a virtual IBAN account can enable you to make use of local payment schemes at significantly fewer costs. The following sections tell you everything you need to know about setting up a virtual multi IBAN account to save costs and paperwork.
What is a virtual IBAN account?
A virtual IBAN works like a standard IBAN, as you can receive and send money overseas. A big difference is that most providers of virtual IBANs don’t allow businesses to store money. Instead, the funds are rerouted to a primary account. Businesses usually create virtual accounts to separate transactions according to entity, client or other purposes.
Depending on the provider, the qualities of the virtual IBAN account vary greatly.
Even better: With the right virtual IBAN account, you can profit from local payment schemes such as SEPA or ACH, which charge a fraction of the costs compared to the SWIFT network.
What is the difference between a standard and a virtual IBAN?
An IBAN (International Bank Account Number) is a bank account number to facilitate international payments. IBAN numbers can consist of up to 34 alphanumeric characters. A standard IBAN is tied to your bank account, and doesn’t replace your account number. When money is sent to your standard IBAN, your associated bank account directly receives the funds.
A virtual IBAN serves the same purpose: It facilitates international transactions. Virtual IBANs are like sub-accounts linked to your primary account, whereby incoming payments are rerouted to your central account. If you set up a multi IBAN account that allows you to store multiple currencies, international transactions become much more convenient, with low transaction costs due to local payment schemes. A virtual IBAN account is also a great way to avoid costly conversion fees if you need to manage multiple currencies.
| Standard IBAN | Virtual IBAN | |
|---|---|---|
| Definition | An IBAN tied to a physical bank account | A virtual IBAN that forwards incoming payments to a main account |
| Function | Directly connected to the bank account | Acts as a sub-account for simple payment routing |
| Currency management | Typically usable in only one currency | Multiple virtual IBANs possible for different currencies |
| Flexibility | Limited – one IBAN per account | High flexibility through the allocation of multiple virtual IBANs |
| Conversion costs | Frequent and often high conversion fees | Reduced or no conversion fees when currency-matched |
| Access to local payment systems | Limited, often only via SWIFT | Often provides access to local networks (e.g. SEPA, ACH, Faster Payments) |
| Best suited for | Simple, local banking activities | International business, multi-currency management |
What is the difference between a foreign currency bank account and a virtual IBAN account?
A foreign currency account at your local bank enables you to hold different currencies. Usually, one foreign currency account is tied to one currency only, such as USD or GBP. Businesses that conduct international payments might consider opening a foreign currency account to save conversion fees.
The problem: Traditional foreign currency accounts don’t allow you to profit from local payment schemes, such as SEPA or ACH. Instead, all incoming or outgoing payments are handled through the SWIFT network, which charges transaction costs of up to 3-5% of the transferred amount. Therefore, a foreign currency account doesn’t solve the biggest cost factor associated with international money transfer. A comparison of business account types helps identify the best conditions for foreign currency accounts and virtual IBANs.
| Foreign currency account | Virtual IBAN | |
|---|---|---|
| Currency binding | One fixed foreign currency per account (e.g. USD, GBP) | Multiple currencies managed through a single central account |
| Incoming payments | Only via the SWIFT network | Possible via local payment systems (e.g. SEPA, ACH, Faster Payments) |
| Transaction costs | High – often 3–5% via SWIFT | Low – often no or very minimal fees thanks to local networks |
| Account structure | Separate bank account per currency | Virtual sub-accounts linked to a main account |
| Currency conversion | ometimes required, depending on the incoming payment | Flexible holding and exchange of multiple currencies at better rates |
| Availability at banks | Traditional product of established banks | Commonly offered by fintechs or specialised payment providers |
| Best suited for | Companies with low payment volumes in a specific foreign currency | Companies with diverse international payment flows |
Why do businesses need virtual IBANs?
Businesses should consider a virtual IBAN account once they grow internationally or have an international supplier base.
Cost savings
The biggest advantage for businesses are the huge cost savings when choosing the right virtual IBAN account. Make sure your virtual IBAN account enables you to make use of local payment schemes such as SEPA in Europe or ACH in the US. This enables you to save SWIFT foreign transaction fees of 3-5%. Further, when you open a multi-currency IBAN account that allows you to store foreign currencies, you are able to avoid conversion fees. Last but not least, you can save monthly fees charged for holding different accounts at your bank.
Business growth
Once you consider expanding into new markets, a virtual IBAN account can solve many problems, as you are able to serve your suppliers and customers in their local currencies without paying a high premium. Even as an e-commerce business, a virtual IBAN account can help you diversify your online payment channels, which in turn can attract more customers from your targeted regions. Therefore, virtual IBANs are a low-cost, yet very efficient support on the way of scaling your business.
Streamlined processes
A virtual IBAN account not only brings financial benefits, but also allows you to streamline your payment processes. First and foremost, setting up a virtual IBAN account only takes minutes until you are able to profit from local payment schemes. Compare this with setting up individual bank accounts in each and every jurisdiction, which is virtually impossible.
Secondly, it is much easier to get an overview of your finances and reconcile all incoming payments, as you can manage your multi IBAN account from one single interface. Further, you can opt to only have one IBAN for all your customers, instead of multiple foreign currency accounts or different bank accounts in multiple jurisdictions.
Advantages of virtual IBANs at a glance
For internationally active businesses, virtual IBANs provide a modern alternative to traditional bank accounts. They allow efficient, centralised management of payments in multiple currencies, without the need to open separate foreign currency accounts. This not only simplifies financial processes but also saves time and money. Virtual IBANs can be directly linked to an existing business account and enable a clear separation of incoming payments by country, customer, or project.
By accessing local payment systems, companies can process cross-border transactions faster and more cost-effectively than with traditional SWIFT payments. At the same time, they retain full control over exchange rates and currency conversions.
- Receive and send payments in multiple currencies without opening separate bank accounts for each
- Significantly lower transaction costs through local networks such as SEPA, ACH, or Faster Payments
- Centralised management of all virtual IBANs via a single main account
- Reduced (or even zero) conversion fees when currencies are matched
- Faster processing of international transactions
- Increased transparency through clear allocation of incoming payments, e.g. by market, product line, or customer
- Greater flexibility in currency management and better control over exchange rates
How to choose the right virtual IBAN provider?
Before choosing a virtual IBAN account, it is crucial to compare providers. For instance, to make use of local payment schemes, your provider needs to have a strong international banking network. Also make sure that your provider is located in a jurisdiction with strong supervisory authorities for the financial market.
Segregated accounts ensure your money is safe, even in case your provider goes bankrupt. Businesses should further confirm that these segregated accounts are held at strong partner banks, so that all funds are safe, no matter the circumstances.
Your virtual IBAN with amnis
amnis provides you with all the benefits you expect from a virtual IBAN account: A multi IBAN account enables you to store, receive and send more than 20 currencies. You are not bound to the SWIFT network, either: Use local payment schemes in the US, Europe, Switzerland, Great Britain or Canada to pay and receive money like a local – the cost savings are substantial.
Additionally, amnis offers a business debit card with multi-currency capabilities, allowing you and your field staff greater financial freedom and the ability to perform international transactions at local costs.
amnis is recognised by the Swiss Financial Market Supervisory Authority (FINMA), regulated in Liechtenstein and supervised by the Financial Market Authority Liechtenstein (FMA). With segregated bank accounts at tier 1 partner banks with first-class credit ratings, you can be sure that all your funds are safe.
Furthermore, amnis is one of the few providers forwarding interest on foreign currency accounts, ensuring you receive balance cashback not only in your home currency and helping you earn high interest while your money remains protected to the highest standards.