How to Open a Foreign Currency Account in the USA

Why someone would open a foreign currency account

Use cases are measurable and common:

• Receive recurring invoices in euros, pounds, or other currencies without repeated conversion.
• Pay suppliers in their local currency to avoid conversion friction and local bank routing issues.
• Hold currency exposure as a limited hedge against dollar volatility.
• Use multi-currency balances while traveling or managing property overseas.

A US foreign currency account can be commercial or personal. A foreign currency checking account USA that supports outgoing payments and debit-card spending behaves like a normal checking account, but the denomination and conversion mechanics differ. Multi-currency account USA products allow balances in many currencies inside a single relationship. The fintech provider Wise states plainly: “With Wise, you can hold money in 40+ currencies, and convert between them at the mid-market rate whenever you need.” Wise — International / Multi-currency account.

Which providers offer foreign currency accounts to U.S. customers

Providers fall into three groups:

• U.S. banks that offer foreign-currency deposit products. These are limited and often aimed at businesses or premium retail customers. East West Bank lists foreign currency deposit and time-deposit products and provides branch-based foreign currency exchange services. East West Bank.
• Offshore banks that accept U.S. customers. Access requires compliance with U.S. tax and reporting rules and may carry local deposit-protection differences.
• Non-bank money services and fintech platforms that provide a reloadable foreign currency account or a multi-currency account USA. These firms typically hold funds with partner banks or in safeguarded accounts rather than offering FDIC insurance in the same form as a bank deposit. Wise and other platforms emphasize low spreads and local receiving details. Wise.

A prospective accountholder should classify the product as a deposit or a safeguarded balance before proceeding. Account legal status affects deposit insurance, insolvency priority, and the regulatory supervisor that governs the provider.

Regulatory protections and reporting obligations

A primary legal distinction is whether deposits are held in an FDIC-insured institution. The FDIC’s employee guide states: “Deposit insurance coverage is provided for deposits in an IDI that are denominated in a foreign currency.” The FDIC converts those deposits to U.S. dollars for insurance-limit purposes using prescribed exchange rates. That means a foreign-currency deposit at an FDIC-insured bank is covered to the standard limits when converted to dollars. FDIC — Financial Institution Employee’s Guide to Deposit Insurance.

Fintech multi-currency accounts commonly use partner banks or custodial arrangements. Those program details matter for protection. A non-bank account that is not an insured deposit carries counterparty risk if the sponsor bank or the custodian experiences operational failure or insolvency. The FDIC has issued guidance and proposals about disclosures where non-banks offer both deposit and non-deposit products.

Tax and cross-border reporting are mandatory considerations. FinCEN requires U.S. persons with financial interests in foreign accounts to file an FBAR when the aggregate value of foreign accounts exceeds $10,000 at any time during the calendar year; that instruction appears on official agency pages. FinCEN — FBAR filing guidance.

The IRS also enforces FATCA and Form 8938 reporting for specified foreign financial assets above statutory thresholds; Form 8938 instructions and the IRS summary describe the applicable thresholds for individuals. IRS — FATCA and IRS — Form 8938.

Fees, spreads and the economic calculus

Costs matter. The total cost of holding or transacting through a foreign currency account comprises three elements:

1. The spread on conversion, which is the difference between the mid-market rate and the rate offered to the customer. Fintech providers often publish a visible conversion fee and aim to provide near-mid-market rates. Banks typically embed a wider spread.
2. Account maintenance and service fees, including minimum-balance requirements, monthly charges, and inactivity fees.
3. Transaction-level fees such as incoming and outgoing wire fees, card-transaction charges, ATM withdrawal charges, and any cross-border transfer commissions.

For a representative comparison, model typical flows: one-off inbound transfer of salary or invoice, monthly supplier payments, periodic ATM withdrawals, and a full repatriation event. The cheapest provider on small recurring amounts may not be the cheapest for large single transfers because fixed wire fees distort unit economics.

Investopedia’s review of foreign currency CDs and deposits highlights a related point: foreign-denominated savings can offer access to higher nominal interest rates in some countries, but currency movements and lack of U.S. deposit insurance for offshore deposits can easily erase nominal gains. Investors should compute net returns after conversion and tax. Investopedia.

Step-by-step process to open foreign currency account in the USA

1. Identify the target currency and the expected flows. Use that projection to size account balances and expected transfer volumes.
2. Confirm whether the provider is a bank and whether balances receive FDIC coverage. If FDIC applies, check how the deposit is converted to dollars for insurance-limit calculations. FDIC.
3. Gather KYC documents. U.S. banks and regulated money services will demand identity, proof of address, tax identification number, and beneficial-owner details for entities.
4. Review the fee schedule and exchange-rate disclosure. For card-enabled foreign currency checking account USA products, check ATM limits and whether dynamic currency conversion will be offered at POS terminals.
5. Ask about operational mechanics for outward transfers and repatriation timing. For offshore or non-bank accounts, confirm cut-off times, correspondent-banking paths, and expected settlement windows.
6. If the account will include foreign holdings above reporting thresholds, plan FBAR and Form 8938 reporting. FinCEN and the IRS provide filing guidance.

Practical selection rules for individuals and businesses

• For low-balance, travel-oriented needs, a reloadable foreign currency account provided by a regulated fintech will generally offer cost-effective conversions and card access. Look for a multi-currency account USA that lists supported currencies and local receiving details.
• For recurring invoicing and supplier payments, a business foreign currency account USA at a bank or a business-focused FX platform often reduces reconciliation friction and offers treasury tools. East West Bank positions its international banking services to meet corporate needs. East West Bank.
• For savings or term deposits denominated in foreign currency, the interest-rate advantage must be modeled against currency risk and the provider’s deposit-protection regime. Investopedia notes that foreign currency CDs can be riskier than domestic CDs because of exchange-rate fluctuations and limited deposit insurance when held offshore. Investopedia.

Operational risks and mitigation

Key risks are currency volatility, counterparty exposure, and reporting or compliance errors that lead to penalties. Mitigation steps include maintaining some liquidity in U.S. dollars, keeping clear records of account values and transactions for FBAR/Form 8938, using FDIC-covered providers when deposit protection is required, and using reputable custodial or sponsor-bank structures when working with non-bank providers.

Final Considerations

Opening foreign currency account USA products demands a structured checklist: identify target currencies and flows; verify legal status and deposit protection; quantify spread and transaction fees across representative transaction types; collect KYC and tax documentation; and plan for FBAR and Form 8938 reporting when thresholds are reached. For many individuals, a reloadable foreign currency account or a multi-currency account USA offered by a regulated fintech provides a practical balance of cost, convenience, and transparency. For businesses or users with sustained foreign exposures, a bank-level foreign currency checking account USA or specialist treasury services may be the appropriate solution. Prospective accountholders should price representative transactions end-to-end, validate account protections, and document cross-border positions for tax compliance before funding significant balances.

Sources and further reading: Wise — International / Multi-currency account; FinCEN — FBAR filing guidance; FDIC — Financial Institution Employee’s Guide to Deposit Insurance; IRS — FATCA; IRS — Form 8938; East West Bank — foreign currency services; Investopedia.