Why Foreign Banks Refuse Americans, and What FATCA Actually Requires

When foreign banks refuse Americans, the one provider we found that gives a reason, Curvo, points to FATCA: a US statute that sets a reporting duty, not a rule against Americans. Here is what it asks a bank to do.

You moved to Lisbon, Berlin or Bangkok, filled in a bank’s sign-up form, and the application stopped at one question: are you a US citizen? Or the account opened, and a year later a letter arrived asking for a form you have never heard of.

FATCA, a US law, turns US account holders into a reporting job for a foreign bank, and the law does not forbid serving Americans: some institutions choose to hold no US accounts, and others report them. Below: how the check works, what to do with that letter, and what providers say on their own pages, read on 12 October 2026.

Why do foreign banks refuse Americans?

FATCA (the Foreign Account Tax Compliance Act) is part of the US tax code, sections 1471 to 1474. In the IRS’s summary, foreign financial institutions must “report on the foreign assets held by their U.S. account holders or be subject to withholding on withholdable payments.”

The penalty does not fall on you. It falls on the bank. Under section 1471(a), a foreign financial institution that does not meet the reporting requirements has “a tax equal to 30 percent” withheld from US-source payments made to it.

The statute gives two ways to stay clear of it: take on the reporting, or hold no US accounts. Section 1471(b)(2) lets the Treasury treat an institution as compliant if it follows procedures “to ensure that such institution does not maintain United States accounts” and meets the Treasury’s other conditions. In countries that signed an agreement with the US (below), the bank follows that agreement rather than the statute directly.

What FATCA asks a foreign bank to do

The duties are in section 1471(b)(1). The bank must obtain enough information “to determine which (if any) of such accounts are United States accounts”, run the checks the Treasury requires, and “report on an annual basis” on each US account.

Who the bank reports to: the two types of agreement

Governments signed agreements with the US Treasury: its table gave a total of 114 jurisdictions on 12 October 2026. Under the first type, Model 1, the bank reports to its own tax authority, which passes the data to the IRS; under Model 2, it reports to the IRS directly. Germany, the United Kingdom, Portugal and Thailand are Model 1; Austria and Japan are Model 2.

The US-Germany agreement lists what is reported: the account holder’s “name, address, and U.S. TIN” (the US tax number), “the account number”, and “the account balance or value … as of the end of the relevant calendar year”.

The small-account exemption, and its condition

The German agreement says that a new individual deposit account “is not required to be reviewed, identified, or reported as a U.S. Reportable Account unless the account balance exceeds $50,000 at the end of any calendar year”. The exemption has a condition: the bank may elect otherwise where German rules provide for it. We did not find that German provision, and other countries’ agreements can differ: check yours on the Treasury page.

How a bank spots a US person: signals, W-9 and tax number

The agreements list the signals, called US indicia, that a bank looks for in its records. The US-Germany text names seven:

For new accounts, the agreement asks for a self-certification at opening, your own statement of whether you are a US tax resident, and it says: “a U.S. citizen is considered to be resident in the United States for tax purposes, even if the Account Holder is also a tax resident of another country.” If you are one, the bank must obtain your US tax number, the TIN, on “an IRS Form W-9 or other similar agreed form”.

If the letter has already arrived

That letter is the same check, run on an open account. If you are a US citizen or US tax resident, send back the form with your US tax number. If you are not, but your file shows one of the seven signals, the bank wants the documents in the next section.

The time limits in the US-Germany agreement bind the bank: we found no reply deadline for the account holder in it, so the date that counts is the one in the letter. Where a change of circumstances makes your earlier answers unreliable and the bank “is unable to obtain a valid self-certification”, it “must treat the account as a U.S. Reportable Account”: it gets reported. Article 4(2) adds that the US will not require a German bank “to close such account” when a holder ignores its requests, provided the account is reported. What a bank does under its own terms we did not check.

Why an “accidental American” gets caught too

US citizenship can come through a parent, so the bank’s question can reach someone who has never lived in the US. One forum member described exactly that:

“I have two friends in London, as well as myself, who have US citizenship through parents (one has never even been to the US)”Monzo community forum, November 2017

A US place of birth is different: it is a signal, not a verdict, and some banks ask for documents to clear it. For accounts held since 2013 or earlier, the German agreement lets a bank set a US birthplace aside only with a self-certification that you are neither a US citizen nor a US tax resident, a non-US passport or other government ID, and “a copy of the Account Holder’s Certificate of Loss of Nationality of the United States or a reasonable explanation”. For new accounts it lists no documents, but N26 states a similar set: “A W-8BEN or similar agreed self-certification form” (an IRS certificate of foreign status), a non-US passport and, if you were born in the US, “a copy of your Certificate of Loss of Nationality of the US.”

If you are a US citizen, by birth or through a parent, that route is not for you: the honest answer is yes, with your tax number. Your options are the providers whose pages show a route in (see the table) and, in the EU, the basic payment account described at the end.

What providers say about US persons, on their own pages

The table lists only what each provider’s own page said, ordered by whether the page shows a route in for a US person. Both refusals we could document come from investing apps, not banks: none of the bank pages we could read states a refusal.

Two providers are missing. Revolut’s help centre returned an access error, so we could not read its eligibility page, and none of the Wise help pages we read says whether a US person living abroad can open an account. For a wider view, see how the main neobanks compare on reliability for people living abroad.

“Don’t allow us” is Curvo’s wording, not the statute’s: the statute asks an institution to identify and report US accounts and does not forbid opening them. We did not verify which FATCA status Curvo holds.

When the refusal isn’t about FATCA

Not every “no” to an American is a FATCA “no”. Residence is a separate test, and it is not about your passport at all. A provider can turn you down because you do not live in a country it serves. If you are between countries, the address question can be the real block, and our guide to opening an account with no fixed address covers it.

Anti-money-laundering checks are a third reason, and a bank does not need your citizenship to apply them. If you are not sure which one stopped you, ask: step 3 of “If you’re refused” shows when the bank must answer in writing.

The reverse case, a US bank closing your account once you move abroad, has different fixes: see what to do when your US bank closes your account after you move abroad.

Your own filings: FBAR and Form 8938

As a US person living abroad, you have two filings of your own, whatever a bank decides.

The FBAR, the Report of Foreign Bank and Financial Accounts, is not part of FATCA: it goes to FinCEN, a US Treasury bureau separate from the IRS. FinCEN says a US person must file it “if the aggregate value of the foreign financial accounts exceeds $10,000 at any time during the calendar year”, and the IRS page comparing the two forms gives the due date as “April 15 (6-month automatic extension to Oct 15)”.

Form 8938 is the one the IRS lists under FATCA for individuals, “attached to your annual return”. For an unmarried person living outside the US, the same page sets its threshold at more than “$200,000 on the last day of the tax year, or more than $300,000 at any time during the year”.

What to prepare before you apply

Treat the US questions as part of the application, not a surprise at the end.

If you’re refused

If you are legally resident in the EU, you have a written right to a basic payment account. The Payment Accounts Directive (2014/92/EU) requires EU countries to give “consumers legally resident in the Union” the right to “a payment account with basic features with credit institutions located in their territory.” Article 15 adds that credit institutions, meaning banks, must not discriminate against them “by reason of their nationality or place of residence”.

The right covers a payment account only, so it does not reach an investing account like the two refusals in our table. A country need not impose it on every bank and may ask you to show “a genuine interest” in opening it there. We found no court ruling on whether a FATCA-based refusal breaches Article 15. The steps below add the national law of one country, Germany’s Payment Accounts Act (ZKG).

Elsewhere in the EU, the authority is the one the refusal must name. Outside the EU we did not check the complaint routes. Before you contest a closure, read the difference between an appeal and a complaint.

FAQ

Written by Daniel Hart, who covers neobanks, account freezes and cross-border banking for neobankfit. Based on the text of 26 U.S.C. § 1471, IRS, US Treasury and FinCEN pages, the US-Germany and US-Austria intergovernmental agreements, the EU Payment Accounts Directive, Germany’s Payment Accounts Act, and the help pages of N26, bunq, Trade Republic, Curvo and Wise, all read on 12 October 2026, plus posts from Monzo’s community forum.

This article is general information, not legal or financial advice. Rules, deadlines and protection limits change and depend on your country, account and provider entity. For your situation, check current terms and consider a qualified adviser.