Using an Offshore Merchant Account

Many of our clients are interested in ways to reduce their current tax
liability with the current business they have. Some are concerned about
ways to move some of their assets "offshore" without throwing up a "red
flag". Others are interested in setting up a new business, perhaps via
the Internet, and need a way to accept credit orders. Regardless of the
need or concern, an "Offshore Merchant Account" may be the ideal answer
for you...

A merchant account is basically an account or facility that allows you
to accept credit card orders from your customers. It's that simple. If
you accept credit card orders already with your existing business, then
you are already familiar with this. But what is the difference or
perhaps advantage of using an "offshore" card processing service vs. a
local or domestic one?

Well, one thing that is certainly true about the US credit card
business, is that it has become very competitive. This has been both a
good thing for both consumers and business owners alike. As a consumer,
you know that interest rates charged on credit card balances have come
down. For business owners, it has meant that where as you were charged
up to 7% in the past to process your customer's credit card purchases,
those rates have come down to about 3% on average. All positive news.
But, there are still problems for the US small businessman wanting to
set up his or her own merchant account.

One major problem is of course the application requirements, and the
possible deposit requirements. Some banks or credit card processors
will not even accept your application unless your business has been
operating for two years or more. Others want a security deposit of $
5,000 or more. Some others even want to "hold back" your monthly card
payments as an additional "security deposit" for possible "charge
backs". In addition, especially in the case of US banks, they act as if
they are doing you a favor to take your business. Aside from all this,
we know of some clients that have had their merchant account "pulled
away" simply because their business started to grow. What am I talking
about? Well, because every US bank is now paranoid about such things as
"money laundering" and "suspicious transactions", any sudden change in
your business volume sparks a reaction. We know of one client that was
given a "we are closing your account" letter by his US bank, because his
monthly volume went from $ 10,000 per month up to $ 18,000 per month in
a fairly short time. The bank said it was "suspicious". The client
said it's called "advertising". Well, you know what they say, people
that fail in business end up in banking (I went from banking to
business, so I guess I graduated).

This is one reason why you may want to look for a bank or credit card
processor that understands your business, your needs, your problems -
and is willing to help. Where can you find someone like that? Well, it
all starts with being able to look beyond your own backyard.

Most people would agree that technology and modern telecommunications
has provided at least some benefit. We now have fax machines, e-mail,
and of course the Internet. What many people do not think about
however, is the fact that the world has become a much smaller place.
What this means for the business owner is, you no longer are "locked in"
to doing business with just the bank or company in your town or state.
You can literally "shop the world" for the best rates, the best
products, the best service, or what ever. You now can do business with
a bank or credit card processor in Germany, Singapore, Holland, or any
place else just as easily as "the bank down the road". In fact, nine
times out of ten, you will find the level of service to be much better
with a bank half way around the world, then you will with your
neighborhood bank. Why? They want your business, and they are willing
to prove it. The other benefits are obvious. If you intend to be
virtual, the best place to begin is by becoming virtual in fact. An
offshore merchant account places you in a virtual / offshore
jurisdiction with favorable tax consequences.

The problem of course with some offshore banks or credit card processors
are the higher processing fees, when compared to current US rates. The
fierce competition that has been seen in the US, has not reached some
parts of the world, at least not yet. However that is slowly changing.
In addition, such things as "Internet Banking" and offshore merchant
accounts are new services that many offshore banks are just starting to
take a look at. Even in a banking location such as Panama (with over
130 banks), these services are not even available with a handful of
banks. However, we did find a very reliable credit card merchant
account service provider that wants to change all that. They are based
in Europe, they have been in business for over 30 years, and their fees
are extremely competitive (with both US bank rates, and especially their
"offshore" competition). In addition, they will gladly accept a new
business without any costly deposit requirements. This is the type of
company to work with, because they want to work with you.

I know what you are probably thinking, "This all sounds very
interesting, but what is the real benefit for me to do business with an
offshore merchant account provider". Well, being able to get better
service, little or no hassles getting your account opened, and lower or
perhaps no deposit requirements are only the "tip of the iceberg". The
real benefits to you as a business owner are the tax reduction
opportunities that become available through the use of a separate
offshore-incorporated company (your company) to handle your credit card
business for you. In addition, you also have a very legitimate and
convenient way to get your business profits offshore. The fact of the
matter is, if you have an offshore bank or merchant company process your
credit card transactions for you, your money already is "offshore".
This being the case, you now have the means to really make the most of
your business income and keep more of what you earn.

For additional information about obtaining an inexpensive offshore
merchant account, or forming an offshore company for tax-advantaged
strategies for your current business, please contact our office.

John Schroder
Ascot Advisory Services
Tel. 809-334-5387 or 809-293-9427
Email: info@ascotadvisory.com -
Visit our web-Site: http://www.ascotadvisory.com-