There are many reasons that a merchant might look for offshore credit card processing providers. Sometimes they need this type of account to gain approval, and other times it is desired the business owner. Here are a few reasons that a business might want to establish an offshore merchant account:
Frustration with Domestic Bank Terms
Many times businesses find that their domestic merchant account is too restrictive for their needs. While local banks tend to only compete with other local banks, the offshore merchant services industry lets you shop a wider market that includes the entire world. There might be an offshore bank that provides exactly the kind of service that you need.
Certain industries are classified as high-risk for payment processing. This is usually due to an increased potential for chargebacks. Merchants who operate exclusively online, such as those who conduct online auctions, sell digital content, or provide internet gaming are on this list. Many of these businesses are reputable and manage their risk well. They just need a merchant services provider who understands their business. An offshore merchant account is needed for this solution.
Small Business that Needs More Flexibility
Domestic banks might offer competitive rates, but high deposit requirements and delays in payments to the merchant can be difficult for the small business owner. Some new businesses can be turned down or charged high fees just because they do not have history yet. A small business needs flexibility in these areas to protect their cash flow. An offshore merchant account can provide this flexibility.
Business Growth that Creates High Volume
If a business experiences sudden growth, the high number of transactions can cause them to reach a volume cap set by a domestic bank. Concern over possible fraud can cause a good business to lose their account, simply because they have become successful. An offshore merchant account will often accommodate high-volume transaction without gouging the business with high rates.
Part of the Business is Located Offshore
Finally, some businesses simply house part of their operations offshore. When this is the case, it can be easier to deal with an offshore merchant account than to try to bring a domestic bank into the understanding of their business needs. An offshore bank will have more understanding of the business owner’s unique operations.
CDKPay is experienced in helping businesses find the right merchant account for your business model.