Panama Friendly Nations Visa After the 2024 Reform

What the new rules mean for location-independent professionals, investors and retirees

Written by Adriana M., Panamanian attorney, lic. 7844

Why This Matters

When Panama introduced the Friendly Nations Visa in 2012 it was the darling of the global mobility scene: no minimum stay, no language test, and you could qualify by opening a USD 5,000 bank account. Unsurprisingly, more than 50,000 applicants grabbed the opportunity, and the Migration Directorate finally slammed the brakes in 2021.
Fast-forward to the 2024 reform—fine-tuned decrees, re-priced investments, and stricter income verification. Yet the route remains surprisingly competitive if you know how to navigate the nuances.

As counsel to dozens of foreign founders and remote employees each year, here’s my ground-level view of the updated pathway. I’ll walk you through:

1. New income-proof categories (and what evidence actually works at the counter).
2. The ongoing duel of real-estate investment vs. fixed bank deposit.
3. Timelines, fees, and hidden costs nobody tells you about.
4. The post-visa roadmap to permanent residency and, eventually, citizenship.
5. Practical tips from my files—and mistakes you want other people to make first.

Pull-quote
“Panama trimmed the fat, but the Friendly Nations Visa is still one of the few programs letting you ‘try before you buy’ in the Americas.”

1. The New Income-Proof Menu

Under the 2024 decree (Exec. Decree 88-A/2024), applicants can choose one of four income streams. The USD 1,000/month threshold remains, but supporting documents are under sharper scrutiny.

1.1 Remote Employment Contract

• Who it suits: SaaS engineers, designers, CX leads hired by foreign entities.
• Docs that work:
- Original labor contract in Spanish or certified translation.
- Last six months of pay slips.
- Employer letter on letterhead confirming remote modality and salary.
• Pitfall: HR often omits a Panama-compatible work-from-anywhere clause. Add one line stating the employer authorises remote performance from Panama.

1.2 Independent Contractor & Freelance

• Provide service agreement(s) plus six months of bank statements showing recurring deposits ≥ USD 1,000.
• Tax return or accountant letter helpful but not mandatory (contrary to rumors).
• If paid in crypto, convert to fiat in a regulated exchange first; the migration officer will only recognise bank credits.

1.3 Pension or Annuity

• Monthly pension of USD 1,000+ or lump-sum annuity generating the same.
• Submit pension certificate apostilled by country of origin.
• Good news: social-security-based pensions are now accepted again after a two-year freeze.

1.4 Dividends or Passive Income

• Company shareholders can count quarterly dividends; present corporate bylaws, audited statements, dividend resolutions.
• Rental income from abroad is not acceptable unless you own the property via a Panamanian company (crazy, I know).

2. Investment vs. Bank Deposit: Which Makes Sense in 2025?

2.1 Real-Estate Investment Route

• Minimum: USD 200,000 (pre-reform it was 300k; the government quietly walked this back to stay competitive).
• Holding period: 5 years.
• Financing: Mortgage allowed up to 70%, but migration officers prefer to see at least USD 60k of your own skin in the game.
• Pros:
- If you purchase before construction (popular in Casco Viejo and Santa María), the promissory contract counts—no need to wait for occupancy.
- Potential rental yields 5–8% in tourist zones.
• Cons:
- Transfer tax, notary, registry fees add ~5%.
- Due diligence on title risk; beach lots can be “possession rights” only.

2.2 Fixed-Term Bank Deposit (CD) Route

• Deposit size: USD 200,000 in a Panamanian bank or credit union (cooperativa).
• Term: 3 years minimum.
• Interest: 3.25–4.10% p.a. for 36-month CDs as of Q1 2025.
• Pros:
- Paperwork is a breeze—just a bank letter and the CD contract.
- Zero transaction taxes.
• Cons:
- Opportunity cost if U.S. treasuries stay above 5%.
- Early withdrawal kills your residency.

2.3 Which One Wins?

If you’re comfortable locking funds and want to keep life portable, the CD route beats real estate on simplicity and exit strategy. But if you already love Panama City’s skyline (I do) and wouldn’t mind owning an apartment near Cinta Costera, the real-estate path gives you leverage and a potential hedge against inflation.

Practical footnote: Our clients who choose CDs often convert to real-estate investors later, once they know the neighborhoods. The migration switch is painless—submit the property deeds and ask for substitution.

3. Timeline & Fees: The Unvarnished Truth

Below is the typical chronology when my office handles the process. DIY applicants can add 2–3 extra visits to Migration.

* We count business days; Christmas and Carnival freeze the system.

Hidden extras nobody budgets:
• Multiple-entry visa sticker (USD 50) if you leave before your provisional card.
• Health insurance (private) for the first year—most brokers quote USD 900–1,200 for 35-year-olds.
• “Express” file transfer between departments: USD 50 under the table. I advise clients not to pay; delays are minimal these days.

4. Path to Permanent Residency—and Citizenship if You Want It

4.1 Meeting the Two-Year Mark

Your “procura” file must show:
1. You still receive ≥ USD 1,000 monthly income (or still hold the investment/CD).
2. You haven’t been absent > 180 consecutive days without notifying Migration.
3. Clean police record—Panama runs Interpol checks again at this stage.

4.2 What Changes at the Permanent Stage?

• No more income proofs—the investment or CD can be liquidated after the 5-year maintenance but not before.
• You may now work locally without a separate work permit (Article 23-C, Decree 88-A).
• Tax residency becomes almost automatic if you spend ≥ 183 days; see our Argentina vs Uruguay Tax Residency for Entrepreneurs comparison to understand regional options.

4.3 Citizenship Clock

• Wait 5 years from the issuance of the permanent card, not from your first landing.
• Basic Spanish interview and civics quiz (think: Who was Vasco Núñez de Balboa?).
• Dual citizenship is tolerated if your origin country allows it; no renunciation oath required for most Europeans and LatAm nationals.

5. Paperwork Deep Dive (Bring a Portable Scanner)

5.1 Apostille & Translation Hacks

– Panama accepts Hague apostilles dated within six months.
– Certified translations must be done locally by a court-approved translator (traductor público autorizado). Budget USD 20/page. Mailing pre-translated docs is futile.

5.2 Criminal Background Certificates

– FBI report for U.S. citizens, RCMP for Canadians, ACRO for Brits.
– Digital fingerprints cut issuance to one week; avoid ink cards.
– If you lived in multiple countries in the past two years, you’ll need each certificate.

5.3 Dependents

Spouse and kids under 25 can piggyback by proving economic solvency (+ USD 2,000 in your bank letter or CD for each dependent). LGBTQ couples: same-sex marriage certificates from abroad are recognised post-2023 Supreme Court ruling—an area where Panama leapfrogged regional peers. For broader context see how Germany treats paperwork in our piece on LGBTQ Expats Thriving in Berlin: Nightlife and Paperwork.

6. Case Study: Remote CTO From Valencia

María, Spanish national, 34, earning EUR 5,200/month as CTO of a Dutch fintech:

1. Opens CD of USD 200k at Banistmo—3.6% APY.
2. Submits remote employment contract plus six months of Wise statements.
3. Receives provisional card in 52 days (record in my office this year).
4. After one year decides to buy a two-bed condo in El Cangrejo for USD 230k; Migration approves substitution of CD with real estate against the same file.
5. By 2030, María will be eligible for a Panamanian passport without renouncing her EU one—handy if Schengen ever tightens digital-nomad stays.

7. Common Pitfalls—and How to Dodge Them

• Bank account denial: U.S. applicants with tiny credit-union statements get flagged. Arrive with a major-bank reference letter and three months of balances ≥ USD 10k.
• “Drop & run” syndrome: Some forums say you can file then leave for two years. Technically possible, but a 30-minute random check-in can trash your approval if you’re unreachable.
• Property titles in indigenous comarcas: Beautiful land; zero chance Migration accepts it as solvency.
• Proof of address: Airbnb booking screenshots don’t count. Obtain a notarised lease or utility bill in your name.

8. Strategic Considerations Beyond the Visa

• Territorial taxation: Foreign-sourced income is exempt unless you invoice Panamanian clients. That means your U.S. affiliate or EU e-commerce revenue stays off the local tax radar.
• Banking reach: Panamanian banks lost some U.S. correspondent lines; maintain a backup account in an OECD country for transfers.
• Healthcare: Public CSS system is hit-or-miss. Private hospital plans start at USD 100/month.
• Exit options: Holders can convert to the Qualified Investor residency (USD 500k) for faster citizenship if geopolitical winds change.

9. How BorderPilot Fits Into Your Playbook

I’m an attorney, so my reflex answer to every “Can I DIY?” is “hire counsel.” Yet even the best law office won’t map life beyond paperwork: neighborhoods that vibe with you, international school waitlists, or the 3% tax gap you didn’t notice in another jurisdiction.

BorderPilot’s algorithm digests 50+ variables—visa cost, tax load, climate risk, even coffee prices—to score Panama against your personal matrix. Start a free relocation plan in five minutes, tweak the sliders, and see whether Panama’s post-2024 visa is still the slam dunk it used to be.

If the data says “sí”, ping me for the legal nuts and bolts. Your first café con leche at the firm’s terrace is on me.