Have you been trying to receive foreign currencies like USD? As a business owner, do you need to make frequent transactions in foreign currencies? Getting domiciliary or foreign accounts will make your transactions a lot more seamless.

A domiciliary account is probably one of the top recommendations you’d already be familiar with. Popularly referred to as a ‘Dom account,’ domiciliary accounts are a common way to receive USD, EUR, and GBP payments in your local country. 

In this post, we’ll explore the types of dom accounts available, what you need to open one and share answers to some frequently asked questions about these accounts.

What is a Domiciliary Account?

A domiciliary account is an account that allows you to receive, send, and transfer foreign payments from your local country. You can receive any type of foreign payment on your dom account. However, sticking to widely accepted currencies like USD, EUR, and GBP is advisable because you can only receive funds based on your bank’s available currencies. 

One limitation of this account type is that you must open accounts based on the currencies you want to receive. This means that to receive Dollar payments, you have to create a USD dom account. And for Pounds, you have to create a GBP domiciliary account.

Unfortunately, you cannot transfer from your local currency to your dom account. You can only receive a currency based on the account you’ve created.

Types of Domiciliary Accounts

Before heading over to the bank to open yours, there are two types of domiciliary accounts you’d have to choose from. 

1. Current Dom Account: This is like a typical current account. It’s mostly suitable for business people who need to carry out many transactions. For example, you can issue checks to third parties on this account. The downside is that it attracts more usage fees compared to the other type of domiciliary accounts.

2. Savings Dom Account: With this account, you can save in foreign currencies and withdraw with a bank teller whenever you want. This is more convenient for individuals who carry out little transactions. 

Both accounts are eligible to receive interests. However, the rates are not fixed. To withdraw funds from any dom account, you need to visit the nearest bank branch and fill out a bank teller. Once you receive the withdrawn sum in cash, you can change that sum to your local currency at any bureau de change office. 

How to Open a Domiciliary Account

The process for opening a dom account in Nigeria, Kenya or Tanzania is pretty much the same. Any individual or business can open a domiciliary account as long as they have the requirements listed below;

• A completed account opening form given by the bank
• Recent passport photographs
• Proof of address such as a utility bill
• Referee letters
• A minimum opening balance (varies from bank to bank)
• A government-issued ID

Please note that the documents required primarily depend on the bank you’re applying to. The entire process is free, so once the checklist you need is confirmed, visit the nearest branch and apply in person. 

Benefits of a Dom Account

Some of the advantages of opening a domiciliary account is that you can;

1. Open foreign accounts and receive payments in foreign currencies
2. You can receive interests on your domiciliary savings account

Drawbacks of a Dom Account

While domiciliary accounts are a great option for carrying out foreign transactions, they have several limitations. Some of the disadvantages of a domiciliary account is that;

1. You cannot process withdrawals from anywhere or directly fund your account with your local currency
2. Dom accounts have high withdrawal commissions 
3. Opening an account requires referees and guarantors which can be inconvenient
4.  You have to physically visit a branch to open an account

A Better Alternative for Receiving Foreign Payments

You need a domiciliary account alternative that allows you to transfer and receive foreign payments conveniently. With a Grey virtual foreign account, you can

• Create accounts in multiple currencies from the comfort of your home
• Get instant access to your foreign accounts
• Enjoy zero to low fees on transfers and international payments
• Seamless withdrawals to your local accounts
• Get lower withdrawal costs and great conversion rates
• Save time by avoiding endless bank queues

And so much more. Ready to explore? Create a foreign account for free and start receiving foreign payments today