As the world of eCommerce continues to grow and expand throughout the world, so do the demands for a safe and efficient form of payment processing.
Offshore high-risk merchant accounts are a great solution to accept credit card payments from international customers. They facilitate the processing of transactions in a variety of currencies but with a lower possibility of risk.
Offshore Credit Card Processing Defined
An offshore merchant account essentially means that the offshore payment processor or acquiring bank is located in a territory outside of the business’ main headquarters location.
When a US-based business opens up a payment processing account in Europe, the European merchant account will be “offshore” in relation to the US business.
Offshore merchant accounts are the same as international accounts. The only difference is that those merchants who seek offshore merchant accounts are labeled as high-risk by US acquiring banks. By contrast, international merchant accounts are utilized by both standard and high-risk merchants who want to take part in the global eCommerce market.
By setting up an offshore merchant account, high-risk merchants are able to process their payments safely. It also offers ideal access to “credit-origination” around the world, which guards the “liquidity” of your establishment.
Which Industries Must Use Offshore Credit Card Processors?
Having to establish an offshore merchant account comes as a necessity, especially as a high-risk merchant. Other factors that contribute to the need for offshore merchant accounts include diversification, industry type, processing volumes, and tax considerations, just to name a few.
Here are seven of the industries that must open an offshore merchant account in order to operate:
- Credit Card Services: With all the sensitive information that service managers and processors must manage, such as bank account information, an offshore processor is necessary to keep this sensitive data secure.
- Accounting: This industry also handles confidential information that requires the most optimal security. Offshore processors can bar any unauthorized access to this information.
- Travel Agencies: Offshore payment processors are an ideal solution as more travel agencies have moved their operations entirely online. This means payments must be processed securely and seamlessly.
- Weapons: Products that fall under the category of requiring a license or are outright illegal need a safe form of payment. These transactions can also take place worldwide. Offshore payment processing can help you reach global customers.
- Pharmaceuticals: This is another industry that has moved its operations online. And this also means that the potential for high volume sales is great. Offshore solutions are made to handle high volumes of sales.
- E-cigarettes: As more e-cigarette users are making their purchases online, these e-Commerce stores also require a safe payment platform.
- Dating Services: Much information is shared on these platforms, such as age, gender, and location. An offshore processor can also facilitate a safer platform for communication.
There are many benefits to opening an offshore merchant account
Offshore merchant accounts offer more flexibility for high-risk merchants. Offshore banks seem much more tolerant than domestic banks. Offshore banks are more likely to accept industries such as dating, gaming, and online gambling. They also offer generous volume caps.
The bottom line is that opening an offshore merchant account gives you easier access to developing markets. This in itself opens up a world of possibilities.