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Is It Easy To Obtain Offshore Merchant Account?
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Many UK Merchants used to locate their merchant account offshore. Suddenly the question arise why they do so? And when I searched found surprising result, high cost saving for local credit card processing fees, major tax obligation or tax free transactions.
Now I will tell you the brief introduction about the offshore merchant account
What is it?
Offshore merchant account also known as International Merchant Account. Account is opened in non-resident country the merchants who trade on internet, these account allows to process online payments and other transactions processes. Business who possesses high risk, bad credit history, chargesbacks and fraudulent activities only payment processing option available for them is “Offshore Merchant Account”. International credit card processing allows merchants who generally don’t qualify for traditional processing to take advantage of less stringent approval standards overseas.
Your transaction is carried out by merchant account provider from outside UK, (the country in which you’ve opened an offshore merchant account) and after that it’s been settled down in UK bank account.
Who needs offshore Account?
High risk business associated with pharma industries, dating sites, online tours and travels, adult entertainment, gambling, drugs and tobacco industries need offshore merchant account for their high risk business. The business which are incorporated overseas get tax benefits of using offshore merchant account. Opening such account can save more money by considerable tax benefits, for e.g high risk business that serves their services in UK markets have incorporated their businesses outside UK to avoid heavy taxes imposed by UK Government. They have to pay about 15% tax to HMRC, but with offshore incorporation they pay just 1% to other governments (where business is incorporated)
How much it cost to open offshore merchant account?
Offshore merchant account generally cost average on UK standard account. For certain businesses operating in high risk sectors they can be less expensive that UK merchant accounts. companies with high volume sales in specific countries can benefit from lower credit card processing charges by having a merchant account in that specific country. Generally fees are based on amount of risk possessed by businesses, these are little expensive than standard merchant account and the settlements periods is bit longer.
When an customers is buying a product or services they will pay through credit card which is issued by UK Card processing company as this is an international transaction here the merchant will be charged higher for the transaction than UK based. But this can be avoided by setting up a merchant account in that country. In that case all credit card transactions made in that country would be processed as local rather than international transactions.
For More Info Visit us on http://www.radiantpay.com/merchant.html
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