Types and Statistics on Non-Resident Cross-Border Accounts OSA, NRA, FTN, EF

Cross-border accounts are bank accounts used for handling international transactions, allowing individuals or businesses to receive, store, and disburse funds in international trade and financial activities. These accounts typically support multiple currencies to accommodate the transactional needs of different countries and regions. OSA, NRA, FTN, and EF accounts are special account systems formed under the backdrop of expanded foreign openness. They each have unique characteristics in terms of account opening conditions, transaction models, and fund transfers, making them suitable for different cross-border financial scenarios. This article will outline the basic content and features of these non-resident corporate overseas accounts.

OSA Offshore Account (Offshore Account)

OSA accounts, or “Offshore Accounts,” are bank accounts opened by domestic banks for non-residents, including offshore accounts for foreign institutions and individuals. They are mainly used for trade transactions between foreign companies and domestic enterprises.

Account Advantages and Features:

1. Free Fund Allocation: Funds are completely isolated and can be freely transferred, similar to accounts opened in foreign banks.
2. Flexible Deposit Rates and Types: Typically offer more competitive deposit rates compared to domestic banks, with more flexible withdrawal options.
3. Relaxed Foreign Exchange Controls: OSA accounts are less affected by foreign exchange controls, facilitating international trade settlements.
4. Tax Benefits: Some countries and regions offer significant tax benefits for OSA accounts.
5. No Reserve Requirements or Interest Income Tax: These accounts are not subject to reserve requirements or interest income tax.
6. Currency Restrictions: Limited to freely convertible currencies, excluding RMB accounts.

NRA Non-Resident Account (Non-Resident Account)

NRA accounts are domestic foreign exchange accounts opened by foreign institutions at domestic banks, excluding offshore accounts for foreign institutions.

Account Advantages and Features:

1. Onshore Management: The opening bank must pay reserve requirements, and interest income is subject to taxation.
2. Fund Liquidity and Restrictions: Funds are considered foreign assets, allowing easy transfers between foreign accounts and following cross-border transaction management rules for domestic transfers.
3. Global Transaction Capability: NRA accounts can conduct transactions globally.
4. Pledge Function: NRA account funds can be used as collateral for loans to domestic institutions.
5. Regulatory Differences: Foreign currency NRA accounts have relaxed regulations, while RMB NRA account transfers with domestic accounts require authenticity verification.
6. Opening Prerequisites: Domestic parent companies must complete ODI (Overseas Direct Investment) filing.
7. Diversified Settlement Methods: Supports various international settlement methods, enhancing fund liquidity and utilization efficiency through automatic fund transfer functions.

FTN Free Trade Account (Free Trade Account)

FTN accounts are the primary type of Free Trade (Free Trade) accounts, referring to accounts opened by foreign institutions within Free Trade Zones.

Account Advantages and Features:

1. Integrated RMB and Foreign Currencies: RMB serves as the primary account, with other foreign currencies as sub-accounts, under unified rules.
2. Onshore Accounts with Offshore Characteristics: Funds in the account can be freely exchanged and operated according to offshore interest rates.
3. Separate Accounting: Isolated from traditional domestic accounts, allowing pilot programs for innovative businesses.
4. Cross-Border Management: “First line open, second line controlled,” allowing free fund transfers between FTN and other accounts.
5. Transfer Convenience: Fund transfers between FTN accounts and foreign accounts are unrestricted by currency and amount.
6. Opening Conditions: Requires completion of ODI filing and assistance from the account-opening bank to obtain special institution codes.

EF Multi-Functional Free Trade Account (Electronic Fence Account)

EF accounts are unified domestic and foreign currency accounts provided by free trade port banking institutions based on customer needs, offering separate accounting services for multi-functional free trade accounts.

Account Advantages and Features:

1. Unified Domestic and Foreign Currency: Funds can be freely exchanged, with full relaxation under capital account transactions.
2. First-Line Open, Second-Line Controlled: Funds can be freely transferred across the first line, while second-line transfers are managed as cross-border transactions.
3. Diversified Management: Supports fast payments and transfers, suitable for the convenient handling of small funds.
4. Wide Applicability: Suitable for all environments accepting electronic payments, promoting the liberalization and facilitation of trade and investment.
5. Differentiated Management: EF accounts and FT accounts differ in the universality and applicability of their services.

The introduction of EF accounts enhances the freedom and convenience of cross-border fund flows, aiding the development of free trade ports. This is a favorable policy for the construction of the Hengqin and Hainan Free Trade Ports and will promote the vigorous development of the regional economy.

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