The role of merchant account providers in an offshore merchant account

How crucial is a merchant account provider to an offshore merchant account?

To discern their role, in this case, in an offshore merchant account, it's important to get a crystal-clear view of what a merchant account provider does. A merchant account provider is bank or a company that run merchant accounts. They own processing systems to process and validate transactions, but they also have reseller capabilities of third parties' processing systems.

Below are the main characteristics of a merchant account provider:

● Your business applies for an offshore merchant account on a direct basis with a merchant account provider

● Your business is personally liable for all the transactions that they process

● The customer's credit card statements contains the business name

● Merchant account providers use payment gateway

● Certain providers have fixed monthly fees exclusive of processing costs

● Can also have setup fees

● May provide long term contract requirements

Remember that an offshore merchant account allows you to accept credit card payments from your customers. You can also accept debit cards and electronic check payments depending on the merchant service you will opt for.

Since merchant account providers have a wide network of established banks internationally, you can be confident that you will have a quite a lot of banks to choose from. The list of contact banks range from those in the European banks, Carribean banking institutions, and yes, certain banks in the Asia Pacific region.

Now that you have information on what they do, how can you pick the right provider for your offshore merchant account needs? Presented are basic yet vital considerations:

● Analyze the fee setup thoroughly

● Contact their customer support to see of they are an established company.

● Check for the packages available. Always have options.

Take the time to do the math on the fee setup. If you feel you need accounting advise, never hesitate to do so. It may take long, painstaking hours to calculate but it's your hard-earned money on the line. Watch out for hidden fees. At the end of the day, if their costs suits your budget, then it's a first step.

It also always wise to call their customer service toll-free number. If they have competent and efficient phone representatives it signifies that they have the resources to actually setup your offshore merchant account. The customer support ideally should be open 24 hours everyday serving the clients' timezones for any concerns that may arise.

Merchant account providers for offshore merchant accounts have and will always offer programs set beforehand to suit your concerns. Know what you are signing up for. Ask if the program have upgraded levels. This is important so that you'll know what rewards, (if any), your offshore merchant account can enjoy once you go live.

Your offshore merchant account provider will setup a website with all the payment gateway programs and shopping cart options. They will also integrate the requirements such as Secure Socket Layer (SSL) Certificate that is needed if you're setting up a payment gateway with an application program interface (API).

It is important to know what you are getting into. Your offshore merchant account is a valuable investment you need to look after with utmost care. Never settle, for there are quite a number of merchant account providers for you to choose from. Before putting your signature, be 101% confident. Your offshore merchant account, with your assets, is what's at stake.

Places for your Offshore Merchant Account to be Cradled

Getting into the wave of setting up an offshore merchant account requires critical thinking and effective strategies. Primarily, merchant accounts is a set up that allows you to accept credit card orders and payments from your customers. Adding offshore into the picture means that you will be able to accept payments using the services of an international bank.

Also, one of the reasons why you set up an offshore merchant account is if your business is considered high-risk. The businesses belonging in this range include but are not limited to travel, online pharmacy, adult website, outbound telemarketing, escort service, etc.


I bet, that one of the questions that's floating in your mind after absorbing the premise of an offshore merchant account is where in the world would you open one?. This is a very important factor to ponder upon considering we're thinking global here. Below are some of the widely-known offshore banks that are accepted as reputable institutions for you to set up a merchant account.

List the countries ideal for an offshore merchant account by reading the whole article:

Places for your Offshore Merchant Account to be Cradled

Lost and confused?: Ways to develop the payment gateway of your offshore merchant account

The basic premise of a merchant account is you have a business that accepts orders using credit card payments. Of course, you always think of expanding, (who doesn't?), so you get into the growing trend of internet business. The more customers you attract, customers, the more credit card payments you will be processing.


In the midst of expansion of your business, you also need to upgrade your payment gateway, to ensure that the funds are securely processed to your offshore merchant account. It is always a good move to get the services of a Secure Payment Gateway company. These companies help other Processors conduct secure business on the internet using Secure Socket Layer (SSL) technology. They provide a system that passes credit card data, authorization requests, and authorization responses over the internet using encryption technology.


Here's what happens, the transaction information is sent by the Payment Gateway secure server via leased line to the credit card network where the validity of the card is checked and the availability of funds on that account is verified. An authorization code is returned via leased line to the Payment Gateway; the authorization is encrypted by the Payment Gateway and transmitted in encrypted form to the web server of the merchant, which triggers fulfillment of the order.



For reputable and established banks, instead of trying to create their own Secure Web System, many Banks and Bank/Processor alliances will use a Secure Payment Gateway Provider to perform this task for them.



But if you have a genuinely competent, efficient and forward-thinking group of developers, you can incorporate the following simple yet economical practices in developing secured softwares for your offshore merchant account.


● initiate a comprehensive meeting between you ( offshore merchant accountholder) and the software vendor (or developer)


●foresee a reasonable budget allocation


●finalize the contract or agreement


●draw a constructive and attainable workflow – from creation to delivery


● develop and distribute the tasks in a close collaboration of both parties.


Some of the critical factors that should be considered in your talk with the software developers are maximum cost savings, time optimization and a pool of talented techno gurus. But mind you, there are always instances that present challenges such as communication gaps, lessened visibility to project status, unforeseen and roadblocks in budget allocation.


You need to keep in mind certain questions to fully come up with a reasonable budget.


●will the accepted rates be per project, per hour, or on a per month basis?


●what will be the risks involved in accomplishing the task?


●are you compromising the quality for an alluring price?


●are there any hidden costs?


The agreement that you have drafted should be solid as possible. Set due dates, with this comes a consultation with the actual group of people who'll be making the software. Ask them of their maximum capability. Avoid making impossible deadlines. Be realistic, match the number of manpower to their capability and the amount of work that they will be accomplishing.


Delegation of the tasks is truly vital. You have to know who matches the specific task in plan. But hindrances and surprise small problems will arise. But this can be solved by a consensus not eating a lot of work time.


Having a secured software for your payment gateway is a sure ingredient in securing your offshore merchant account. If the funds are settled accordingly, and hassle free, then rest assure that your business is in the best shape.

The unbreakable thread between offshore merchant account and payment gateway

An offshore merchant account processes a business' credit card transactions through a non-domestic processing bank. Many foreign banks are not subject to the same regulations and restrictions as U.S. banks.


There exists this invisible yet unavoidable link between offshore merchant account and an internet payment gateway. When your offshore merchant account is finally in the works, this is the time when you'll start accepting credit card payments online as well. This is the time when payment gateway comes into the picture.


Here are the step by step process being done by payment gateway:


●credit card authorization


●settlement processing


●transaction recording


Internet payment gateway, by definition, is an lets you process credit card orders from your business' website in real time. For instance, you're running a gaming website, once the bets begun to kick in, there's a link providing your customers the channel to key in their credit card account number, then the internet payment gateway processes the transaction like a normal credit card terminal in a retail shop, the transactions goes through the credit card networks, in an average of two seconds, the payment gateway reflects the results, saying if there were sufficient funds in the card or not.


Real-Time Processing means that when a web site's customer conducts an online purchase, that the check or credit card information is conveyed to the Processor at that exact time so that an authorization can be requested and received at that moment. Real-Time Processing always implies that a Secure Payment Gateway is being utilized, whether proprietary or third party.


Once the day closes in, usually there is a specific time when your payment gateway updates, the payment gateway collects and groups all the transactions for the day in a single batch. After this, the grouped transactions are passed to your bank so that the payment will be received. When the funds settle in, it will take an average of two business days for it to be reflected in your bank account.



You won't be kept in the dark on your offshore merchant account. Through your payment gateway, you'll be able to view the transactions, with the transactions history depending on your settings, you can print or download the transactions for further review or just to have a copy in black and white. Certain payment gateways even have Quickbooks, a financial and taxation software, so the accounting task will not be so painstaking anymore.

Your offshore merchant account will be fully utilized by incorporating an internet payment gateway. Since offshore merchant accounts in reality arise from the fact that high risk businesses are at the bottom of the merchant account application accepted list of domestic banks, you can definitely monitor your business better, know your clients, and have a better footing on expanding globally. These two, go hand in hand, they complement each other, thus, you need to utilize them both to ensure success.

Myths about Offshore Merchant Accounts

When you hear the term, Offshore merchant account, or just the word offshore, what initially comes to your mind? Suspicious. Somewhat mischievous. Sounds paranoid, isn't it? Don't worry. It's just but normal to be cynical about this. We have watched in movies businessmen being arrested because of having a “hidden” offshore merchant account. But in reality, an offshore merchant account isn't as bad as it seems.


First, let's get to the basic premise of an offshore merchant account. If you are engaged in an business that fall under the categories of travel, online gaming, online pharmacy, adult website, outbound telemarketing, escort service, etc., then, an offshore merchant account is a feasible option for you. But, actually, no matter what kind of business you have, setting it offshore is always a feasible option. Emphasis are given to the afore-mentioned types because they are considered high-risk businesses by domestic banks.


Talking about high risk, this is one of the myths surrounding offshore merchant account. Some say that opening up one is a risky step. One of the reasons seen is that you opt to make transactions with foreign banks. Foreign , being the operative word, smells like anonymity or hidden from the public eye. Clearing this, an offshore merchant account is not actually a secret account. You just have a privacy option. Domestic banks also have the same clause for you to check if you want to keep your account private in a certain level as well.


Another gray area regarding an offshore merchant account is that it is a way to escape tax obligations. In certain cases, you may be lured to the promise that there are super-low or virtually no U. S. taxes due on your account for the reason that you will use a separate offshore- company (your company) to handle your credit card transactions for you, or that you;'re not actually the owner, you just manage it, or that no taxes are owned on offshore trust incomes.

The reality is you may be be able to hold over taxes until you declare your offshore earnings, but the watchful eye of the Internal Revenue Service (IRS) is just computing on the shadows on how much you actually are liable to. You will not be able to legally set aside taxes without assuming an investment risk or make a total surrendering of your control over your assets. It is a complicated process that entails legal action from a legitimate financial consulting firm. Bottom line, taxes are an inevitable part of life. Every working citizen paid by the hour pays taxes.


Setting up an offshore merchant account may seem tricky to most, to get a better perspective, get the services of a merchant account provider. They have an established network of foreign and yes, domestic banks, to help you set up a merchant account. This move will help you be more knowledgeable of the inner workings of an offshore merchant account.


They say, what you don't know won't hurt you. But, at the end of the day, knowing what really happens makes you feel connected to the world, in the case of an offshore merchant account, what you know will not hurt you as well.


isn't as bad as it seems.

Maximizing your Tax Reduction Opportunities in an Offshore Merchant Account

Even in an offshore merchant account setting, the saying, “ nothing is permanent except death and taxes” applies. People would tend to ask, “ Why go for offshore?”. There are a couple of reasons and one of them is the tax reduction opportunities that an offshore merchant account brings. When you go offshore, you're money is subjected to foreign banking laws and policy.



Most offshore banks lean more into foreign investors. Tax incentives are their way of showing the appreciation. This means lower taxes. Since you don't invest on local operations, less or sometimes no tax at all is imposed at your account. This may sound scrupulous, but it's perfectly within the legal boundaries.


The kinds of taxes that offshore merchant accounts are less exposed to are:

●withholding tax

●stamp duties

●taxes for cheques issued or accepted


This reduction in taxes provide a healthy investment atmosphere. When you're in safe place, you'll be more confident and can concentrate more on making profit. You may wonder where you can actually set up sound offshore merchant accounts.

Read on for more information : Maximizing your Tax Reduction Opportunities in an Offshore Merchant Account

What's In Store for you in an Offshore Merchant Account?

Offshore is becoming the banking trend nowadays. Merchants are becoming more aware of the endless possibilities to reach a worldwide market. What lures them to divert from their local banks to opening up offshore merchant accounts?

●Hassle-free application
●Wide selection of banks
●Secured credit card processing
●Fast account update
●Global market reach
●Big savings on taxes

The benefits you can get from the offshore merchant account bandwagon are countless. Once you're in it, you'll realize that it's one of the best merchant strategies you ever ventured into.

To enjoy the benefits, read the whole article : What's In Store for you in an Offshore Merchant Account?