High risk businesses often face challenges getting a merchant account in their country of origin. For some, working with offshore merchant account providers makes the most sense.
These providers can be especially helpful for merchants who have had merchant account applications denied several times over.
Offshore merchant account providers can also help businesses navigate the challenges required to operate as an international company. Global retail e-commerce sales are slated to reach $2.84 billion by the end of 2018 and $4.88 billion by the end of 2021. Ecommerce is growing at a rapid rate around the world, suggesting that online businesses have plenty of revenue opportunities in a number of countries. Offshore merchant account providers can help streamline the process and set merchants up for success.
For high risk ecommerce merchants and those that do a significant amount of business in foreign countries, working with an offshore specialist can help streamline payments and operations.
Access to Markets All Around the World
Offshore merchant account providers offer business owners direct access to marketplaces across the globe. These specialists allow merchants to conduct operations anywhere they would like and can help them develop a reputation as a trusted global business.
Offshore merchant account providers also offer merchants multi-currency support, enabling them to accept payment in local currencies for customers around the world. For domestic merchants that serve a large customer base in another country, it is best to obtain a merchant account in that country.
Working with an offshore merchant account provider can also cut down on misunderstandings that lead to lost business. Often, transactions originating in foreign countries—particularly those known to have high rates of fraud—are flagged by traditional banks. This can result in blocked transactions and false declines from a business’ most valuable foreign customers.
In many cases, offshore merchant account providers offer currency conversion services that will convert foreign funds into the merchant’s local currency. These providers can often offer lower conversion fees than traditional banks, making them cost-effective options.
Ideal for High Risk Merchants
Another reason merchants seek out offshore merchant account providers is to enable payment processing for their high risk business. Traditional merchant account providers will often reject applications from high risk merchants, making it impossible for those merchants to run their business. In extreme cases, high risk merchants have had their accounts terminated, adding them to a “blacklist” that can keep them out of business permanently.
The good news is that there is recourse for merchants that fall into one of those buckets. Partnering with an offshore merchant account provider that specializes in high-risk accounts can reignite an otherwise dead-in-the-water business.
Merchants should carefully analyze options when it comes to offshore merchant account providers. Not all high-risk payment processors cater to international merchants, and some will not provide offshore accounts to merchants located in the U.S. On the other hand, some will only work with U.S.-based businesses. Vetting offshore merchant account providers before applying can save time in the long-run.
Once a merchant finds an offshore provider that is a good fit for the business, there are many benefits. Many offshore banks offer a degree of leniency that can aid high risk businesses. More relaxed legal and banking frameworks in other countries can help high risk businesses operate under more agreeable rules and regulations. The result is simplified business operations and reduced costs.
Corporate tax rates may differ for offshore accounts as well, so merchants should explore how the rates in different countries impact their business. Each country is governed by its own tax laws, which may or may not be beneficial for a high-risk business. Working with an experienced offshore merchant account provider that can help a merchant navigate these considerations and choose the best options for the merchant’s unique business is recommended.
MerchACT has more than 10 years of experience as one of the most respected offshore merchant account providers. Our successful track record and bleeding-edge technology allows us to support organizations of all types and sizes in building their global customer base.
We offer a full suite of offshore merchant account services to help support and maximize business growth, including offshore merchant accounts for U.S. companies and high volume offshore merchant accounts.