Many business owners are turning to offshore merchant accounts as an alternative for accepting credit and debit card payments. This is especially true of online vendors. Offshore merchant accounts have a number of attractive features that work well for certain business types. However, there are both advantages and disadvantages to using offshore merchant account services. Therefore, it is important to research the pros and cons carefully.
First of all, offshore merchant accounts accept applications very leniently and work with high risk businesses. Many online services, including dating sites, pornography, and the sales of high ticket items are considered to be high risk. Often, when one cannot receive approval for a local merchant account, an offshore merchant account provides a viable alternative.
In addition, offshore merchant accounts can help a business to grow internationally, as they usually accept multiple forms of currency. Plus, there is potential to save money with an offshore account due to the tax break they may offer. However, tax laws regarding offshore accounts vary from state to state, so be sure to do your research.
On the other hand, offshore merchant accounts handle numerous online businesses, which means the potential for fraud is high. Internet hackers may cause a breech in security. Plus, the types of businesses that offshore merchant accounts manage pose a high risk for credit card chargebacks. Therefore, many offshore merchant account providers charge steep fees for their services. In addition, some merchant account providers themselves are con artists who will run off with your set up fees or steal from you in other ways.
When selecting an offshore merchant account provider, it is important to take your time and be cautious of fraud. Research all of your options thoroughly and know the terms of your account. Although there are some risks involved with using an offshore merchant account, there are also many advantages. Some business owners can greatly benefit from the services that offshore merchant accounts provide.