An offshore merchant account is a smart way to protect payment processing continuity and mitigate risk. An offshore merchant account is often associated with high risk processing. But, businesses in any industry can benefit from establishing an offshore merchant account.

How Offshore Merchant Account Protects Payment Processing

Businesses processing high volumes of transactions, particularly those in high risk processing classifications, are putting their business in unnecessary danger by processing through a single acquiring bank. An offshore merchant account is an important part of any long-term processing strategy for mitigating risk.

Consider a company relying on a single domestic acquiring bank. The company does not have an offshore merchant account for processing redundancy. What happens if, due to politics, economic crisis, or regulatory changes, the bank is unable to process transactions? How will the company’s business operation and cash flow continue?

If the company had an offshore merchant account, payment processing could immediately be diverted and business operations could continue without interruption. Most companies have redundant systems and contingency plans in place for the most vital business operations. And what is more vital than payment processing, the lifeblood of any business?

An offshore merchant accounts is simply smart business. Setting up offshor
e merchant accounts should be an integral part of strategic contingency planning for any forward-thinking company.

Offshore Merchant Account Decreases Operating Expenses

In addition to safeguarding your business operations against potential losses, an offshore merchant account can actually save you money on payment processing costs. Interchange rates vary among jurisdictions. Therefore, discount rates for an offshore merchant account may actually be less expensive than processing through domestic accounts.

In addition, any business with international operations should consider an offshore merchant account in addition to domestic ones. Processing international transactions through an offshore merchant account will reduce cross-border fees and save substantial money on foreign exchange conversations.

What is an Offshore Merchant Account?

An offshore merchant account is simply processing established with an acquiring bank outside of the jurisdiction in which a company was originally incorporated. For instance, a company with that is incorporated in the US establishes an account with a European acquiring bank. The European account is considered an offshore merchant accounts to the US company. Or, if an Australian company establishes trading accounts with an Asian acquiring bank, the Asian accounts are considered an offshore merchant account to the Australian company.

An offshore merchant accounts can be established quickly and easily. Most processing through an offshore merchant account are set up with low rates and favorable terms.