Merchant account forums

Offshore Merchant Accounts,
An Overview

Definition
An offshore merchant account is as it sounds, a merchant account that is based offshore i.e. in another country. On the surface the only real difference between an offshore and a domestic account is the geographical location of the associated processing bank but there’s far more to it than that.

This article touches on some of the specific functions and possibilities that justify the rapid increase in, and demand for, offshore merchant accounts.

What do offshore merchant accounts provide?
Offshore merchant accounting is far less restricting than the domestic equivalent and is used by e-merchants for a whole range of reasons that fundamentally stem from versatile global legislation.

Perhaps you are looking to spread some of your assets abroad or simply set up a new company in a reduced tax environment, offshore merchant accounts accommodate both and much more.

Flexible Jurisdiction
Trading laws that apply to one country, don’t necessarily apply to the next. If your business doesn’t comply with domestic legislation, or is considered non-viable or high risk, it doesn’t mean you won’t be accepted somewhere. This isn’t suggesting you need to go traipsing around the world, making long distance telephone calls and learn new languages, it just means that your merchant account and processing facilities function outside the jurisdiction of your country.

More Accommodating
Whereas domestic account providers, namely banks, may deny your application on the basis of ‘high risk’, offshore merchant account providers are fully accommodating specializing in this form of business.

Less Restricting
Processing limits implemented by domestic merchant accounts can seriously restrict the merchant’s ability to price his/her services freely and simultaneously, limiting their potential sales volume. If you surpass the processing limit granted by a domestic bank, i.e. your revenues exceed the amount the bank are prepared to be liable for, you run the risk of heavy fines and possible account closure. Offshore merchant accounts exercise little or no such restrictions.

Click here to learn more about the advantages of offshore merchant accounts.