Why is it so difficult for US expats to access financial services abroad?
Since the introduction of FATCA (Foreign Account Tax Compliance Act) in 2010, US expats have found using financial services abroad increasingly difficult. The act is intended to ensure that the US gets information on accounts held abroad at Foreign Financial Institutions (FFIs) by US citizens.
The problem facing US expats
It’s getting harder and harder to use any kind of financial service if you’re an American citizen living abroad. Things like opening a bank account or applying for insurance are long and difficult processes (if you manage at all), and US expats are even having existing accounts closed.
Foreign Financial Institutions are being forced to give the USA information about their US clients (e.g. money coming in and out of accounts, account ownership, etc.) and comply with FATCA regulations or be penalised. Some institutions have had to pay out over $1bn to meet these regulations, making US expats a costly and uninviting investment.
American Citizens Abroad is working with the State Department Federal Credit Union to provide accounts for US expats abroad. This is a similar account to those who work in US embassies as well as many other people across the world.
It doesn’t matter if you are abroad for full-time or part-time, you will still qualify. Everything can be done online and all deposits and savings are insured by the National Credit Union Insurance Fund.
Hopefully more and more solutions will become available for US expats in the future.