Bank Account in Armenia for an IT Entrepreneur: How to Prepare a Description of Foreign Incoming Payments for the Bank

An entrepreneur opens a bank account in Armenia and states «software development» in the application form. A month later, the account receives payments from a company in Germany, a US platform, and an individual from another country. All of them are related to IT, but based on the initial description, the bank cannot understand who is paying the entrepreneur and for what.

When opening an account, the bank needs more than just information about the client’s profession. It must understand the expected business activity and be able to compare future transactions with the documents and explanations provided by the account holder. Therefore, preparing to open an account includes describing the actual flow of funds: from the contract with the client to the incoming payment and the subsequent business expenses.

This does not mean that every amount must be predicted down to the exact euro. It is important to explain the model in sufficient detail so that the first payments do not appear unexpected compared with what the entrepreneur stated during registration.

Why «IT Services» Is Not a Sufficient Description

IT activities can involve different ways of earning income. A developer may be paid for hours worked under a contract with a single client. A studio may issue invoices for project milestones. A SaaS service may receive small payments from numerous users through a payment platform. An agency may receive money from a client and pay contractors for their work.

For a bank, these models are different. They involve different numbers of payers, transaction amounts, payment purposes, and documents that can be used to substantiate the transactions. A payment from a single corporate client can easily be linked to a software development agreement. A payout from a payment provider for subscription revenue will need to be explained through the agreement with the provider and a sales report, since the names of the end users will not match the sender of the bank transfer.

Therefore, when describing the business activity, it is better to avoid the phrase «any IT services». It may seem universal, but it does not help the bank verify a specific payment.

Five Questions the Business Description Should Answer

The bank may use its own application form and request additional information. However, when preparing, it is useful for the entrepreneur to put together a description that answers five questions:

1. What exactly is being sold? Custom product development, technical support, a software license, access to a SaaS service, or several separate lines of business. If the activities are mixed, it is worth specifying the main sources of revenue rather than grouping everything under the word «consulting».
2. Who pays? Several companies under direct contracts, a large number of users through a payment provider, or a platform that transfers accumulated revenue to the entrepreneur. If the money comes from an intermediary, its role should be explained.
3. Where do the funds come from and how often? Specify the main countries of the payers, currencies, approximate number of transfers per month, and expected range of amounts. Seasonality or a large payment for a project milestone is better disclosed in advance.
4. On what basis are invoices issued? For contract development, this may be an agreement, a statement of work, and an invoice; for subscriptions, the terms of sale of the product and reports from the payment platform. The purpose of the bank transfer should correspond to these documents.
5. What will the money be spent on? Payments to contractors, cloud infrastructure, software tools, taxes, and the entrepreneur’s own expenses require a clear flow of funds after the revenue is credited.

The answers do not need to be lengthy. A good description allows someone who is unfamiliar with the product to reconstruct a typical month of the business’s operations and understand the origin of each main type of incoming payment.

How the Description Changes for Different IT Business Models

Custom Development

If the entrepreneur works with two or three foreign clients, the description should be based on the services provided under each agreement, the invoicing schedule, and the expected amounts. It is useful to clarify whether clients pay monthly, upon acceptance of project milestones, or in advance.

Suppose the application states that there are two regular clients from the EU making payments in euros. The first transfer from a third company for a significantly larger amount may be legitimate, but the bank may request a new agreement and an explanation of the change in the business model. Therefore, new major projects are better supported by documents from the outset rather than trying to find them after receiving a request from the bank.

SaaS Product and App Sales

Here, the payer shown on the bank statement is often a payment platform or app store, even though the revenue is generated by purchases from numerous users. The description should distinguish between the end customers and the organization transferring the money to the account.

The bank may require information about the product, the sales method, the agreement with the payment partner, and how payouts are calculated. It is particularly important to explain why the transfer amount differs from the gross revenue shown in the sales dashboard: fees, refunds, and other amounts provided for under the platform’s terms may be deducted before the payout is made.

If the product is only being prepared for launch, projected revenue should not be presented as existing revenue. It is sufficient to describe the planned model and separately specify which transactions are actually expected to begin in the near future.

Agency with Foreign Clients and Contractors

In an agency model, the bank sees not only incoming payments but also regular outgoing transfers to developers, designers, and other contractors. If the entrepreneur receives EUR 20,000 from a client and then transfers most of that amount to several contractors, both sides of the flow of funds should correspond to the agreements in place.

Here, it is important to describe the entrepreneur’s own role accurately. The agency may act as the service provider to the client and independently engage a team. Under another model, it may act as an intermediary. These relationships should not be mixed: the purpose of the incoming payment and the grounds for payments to contractors will be different.

Example of a Description That Can Be Verified Against Documents

The entrepreneur develops web applications for two corporate clients from Germany and the Netherlands. Payments are received in euros monthly under an agreement and invoice, approximately EUR 4,000 to EUR 8,000 from each client. Some tasks are performed by independent contractors, whom the entrepreneur pays under separate agreements. No cash payments from clients are expected.

This description is useful not because it contains the «right» countries or amounts. It identifies the services, payers, frequency, currency, and subsequent use of the funds. It can be compared with the agreements and future transfers.

If, in reality, the entrepreneur receives revenue from an app through a platform, this example should not be copied. The description must reflect their own business model; otherwise, the very first incoming payments will contradict the information provided in the application.

What Documents to Prepare Along with the Description

The exact list is determined by the bank. The published requirements of Armenian banks provide for verification of registration details and may include additional documents concerning the source of funds and the nature of transactions. Therefore, before submitting an application, it is useful to gather materials that support the key elements of the business description:

• Registration documents. They show who is opening the account and in what capacity they operate. The name of the account holder should be consistent with the agreements and invoices.
• Agreements with key clients or platforms. They show what the entrepreneur is being paid for, who transfers the money, and how the remuneration is determined.
• Invoices, acceptance certificates, and sales reports. They link a specific amount to a service, project milestone, or sales period. For platform-generated revenue, a report explaining how the transferred amount was calculated is particularly useful.
• Documents relating to outgoing payments. If part of the incoming funds is subsequently transferred to contractors, agreements with them help explain the nature of such transfers.

There is no need to send the bank every working file and piece of client correspondence in advance. It is more important to have documents that consistently support the stated business model and to clarify with the chosen bank how they should be submitted.

What to Do If the Payment Model Changes

The description provided when opening the account reflects the expected business activity at that time. The business may acquire a new client, enter another market, or switch from custom development to subscriptions. This is a normal development of the business, but new transactions should have a clear basis.

If, instead of two monthly transfers from known clients, numerous payouts from a marketplace begin to arrive, it is worth preparing an explanation of the change in the business model and the platform documents. The same applies to a one-time large payment, a new currency, or transfers to contractors in countries where the entrepreneur has not previously operated.

The bank assesses transactions not only when the account is opened. Evocabank, for example, expressly states that the execution of an accepted payment order may be cancelled if there is no evidence of the origin of the funds or in the event of other discrepancies. Prepared agreements and a consistent description of the business activity reduce the likelihood of a prolonged exchange of clarification requests, but do not guarantee that every payment will be processed.

Where to Start Before Contacting a Bank

Prepare a description of a typical month of the business: who is expected to pay, for what work, into which account, in what currency, and what payments you then plan to make. Compare it with the existing agreements and the expected payment descriptions. If there is a gap in this chain—for example, the agreement is concluded with a company while the account is opened in an individual’s name—it should be resolved before the first payment.

It is worth choosing a bank once this structure is clear. You can then ask specific questions about working with the required countries and currencies, the documents needed to open the account, and support for the particular type of international payments involved.