Offshore merchant processing, whether you plan on processing domestic or international payment cards, is a critical part of any offshore, foreign, or high-risk business.
In fact, in many cases, it is the most challenging aspect of setting up and operating a business correctly.
In this article, we’ll be discussing the intricacies of offshore merchant processing, the businesses it works for, and alternative options to consider.
Of course, if you’re looking for other offshore resources, you can access any of our free articles right now – they include topics ranging from opening offshore business accounts to accessing offshore debit cards.
Feel free to use the table of contents to jump ahead to the sections most relevant to you.
Table of Contents
- Offshore Merchant Processing
- Credit Card Processing
- How to Open an Offshore Merchant Account
- Frequently Asked Questions
- Ready to Explore Your Options?
Offshore Merchant Processing
Offshore merchant processing refers to processing payments for businesses that are registered (and operate) outside of the jurisdiction in which the payment processor is based. That said, offshore merchant processing has also become synonymous with processing payments for high-risk, prohibited, and offshore entities.
The reason that merchant processing has become synonymous with these types of activities and entities is that they tend to be better versed in complex client accounts, difficult onboarding, and supporting cross-border transactions.
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How to Open an Offshore Merchant Account
To open an offshore merchant account, you will first need to assess your business and determine whether or not an offshore merchant account is required. In many cases, businesses are eligible to access onshore payment processing, which can be far less expensive and easier to open. With this in mind, when onshore payment processing is available, you should consider this option before opening offshore.
Additionally, if you are looking to open offshore because you want diversification, insulation from economics or politics, or to support local financial obligations in another country, then you may want to consider opening an offshore bank account instead.
This is because finding and opening offshore bank accounts is a more straightforward process. In fact, businesses from most countries can accomplish this with a little help, like the kind offered in GlobalBanks IQ. This includes businesses from offshore, foreign, and high-risk jurisdictions.
On the other hand, opening accounts with offshore merchant processing companies can involve very detailed due diligence, complicated onboarding, direct negotiations, and much more.
Requirements to Open an Offshore Merchant Account
The requirements to open an offshore merchant account will vary from company to company. However, it’s important to note that not all businesses are eligible for merchant processing. Instead, merchant processors look for businesses with sufficient volume, low enough risk, and revenue potential to make them attractive clients.
That said, just because an offshore merchant account may not be available to you, that doesn’t mean there aren’t other credit card processing options available. In the next section, we’ll discuss credit card processing for smaller businesses that may not be eligible for offshore merchant services just yet.
Credit Card Processing
Before answering a few questions, we want to share the first step that small businesses and start-ups should be considered for credit card processing, Stripe.
Even if Stripe (and similar services) are not available in your country, there are still options available to most business owners. In fact, one of the most common solutions we see is foreign non-residents incorporating a business in the United States, then opening bank accounts and credit card processing with Stripe almost immediately.
We outline the specific steps to find and open both bank accounts and payment processing in the United States in our dedicated banking report on the subject.
Frequently Asked Questions
Below are two of the most common questions that we receive from people looking into offshore merchant processing. If you have further questions you would like answered, don’t hesitate to get in touch with us directly.
What Is an Offshore Payment Processor?
An offshore payment processor is a payment processing company that primarily serves offshore, foreign, and high-risk credit card processing. That said, offshore payment processors are often located in mainstream banking jurisdictions, including the United States and parts of Western Europe. Of course, opening accounts with offshore payment processors can be challenging as their onboarding process and due diligence is onerous.
How Do You Open a Merchant Account?
To open a merchant account, you will need to select a bank that offers merchant services. Importantly, different banks have different requirements for the size of businesses that they are willing to serve. Additionally, fees for merchant services can vary widely. So, it’s important to request (and review) the related fee list for merchant services before starting the account opening process..
Ready to Explore Your Options?
If so, you can access GlobalBanks Insider and start the process of applying for an offshore account in a few clicks.
GlobalBanks Insider is a dedicated account opening solution that involves direct support from our team and direct introductions to the banks of your choosing. It gives you instant access to the…
+ Direct support from a team of banking experts
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+ Expert insights on which banks to choose & why
+ Plus FULL access to our entire suite of account opening tools and intelligence!
And “yes!” GlobalBanks Insider is designed to help foreign and non-resident individuals and companies open bank accounts.
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