Clash of the titans: Offshore merchant account versus domestic merchant account

July 17, 2007

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<div align="justify">Introducing on the right corner, offshore merchant account, on the left corner, domestic merchant account. There has been a discreet battle between offshore and domestic merchant accounts since high risk businesses are multiplying by more than a dozen on a daily basis. Also, debates on who has the edge have surfaced. Would it be a more peaceful world if we reconcile these two? </div><h1 align="justify">On common ground</h1> Even if these two seem to have be always at a arm's length, they have certain similarities. Below are where they make a connection:●Both accept credit card payments ●Both are handled by an established bank ●Both require fees ●Both have terminals and payment gateways ●Both are reviewed by underwriters, a group of financial consultants who evaluate the requirements submitted. And one significant common denominator between these two which ironically also sparks the competition, is both cater to high risk businesses. <h2 align="justify">Sibling rivalry</h2><div align="justify"> Even though both have the same premise which is accepting credit card payments, accommodating high risk businesses such as adult, <a href="http://www.offshoremerchantexperts.com/plunging_into_the_world_of_escort_service.html">escort service</a>, dating service, <a href="http://www.offshoremerchantexperts.com/skydiving_to_success_with_a_travel_merchant_account.html">travel</a>, <a href="http://www.offshoremerchantexperts.com/landing_on__a__win-win_situation_with_a_gambling_merchant_account.html">gambling</a>, and telemarketing among others is another story. Let's see where the battle begins. Stage 1 - Application evaluation Local banks tend to have more than second thoughts when high risk businesses go in to submit their letters of intent to set up a merchant account. To be fair, local banks wants to stay in safe place. With the mere sighting of a high risk as type of business, added research is done and the application goes automatically go to the third waiting list folder. Nothing is wrong with that actually, but the inconvenience lies in the waiting period, you have a business running with sales coming in. You applied for a merchant account to get more avenues for profit to pour in. A single day counts. Offshore banks entertain almost all merchant account applications, both from local skin or outside guests . A bank in Cook Islands, warmly embraces merchant account applications not only from their natives, but also from Americans, Europeans, Asians, or any other nationality. Approval is faster, which also depends if all the conditions are fulfilled at first submission. Stage 2 – <a href="http://www.offshoremerchantexperts.com/paying_your_offshore_merchant_account_dues.html">Merchant account fees</a> Domestic banks per se offer affordable rates. Since there is a growing head-to-head competition among US banks, with one bank lowering their transaction fee today, the next bank will give rebates tomorrow. Monopoly is out of the picture. On the other hand, when you have an offshore merchant account, people see this as an expensive merchant account. This assumption can be given be given logic because you're dealing with foreign policies, that everything is converted into US currency first. Once you take a closer look, you will be able to see that offshore banks offer reasonable rates as well. It doesn't mean that less fees equals savings, especially if you have a high volume business. What counts is to verify if the fees are valid. You may rates lower than the market average, but are they valid? Is there really a need to pay for them? Think about this, would you like to pay a little higher but only to a minimum of five rates or pay less for a dozen of unnecessary items? Stage 3 – <a href="http://www.offshoremerchantexperts.com/maximizing_your_tax_reduction_opportunities_in_an_offshore_merchant_account.html">Tax reduction</a> The “Swiss guard” of US business earnings, the Internal Revenue Service (IRS), has its watchful eyes on every business transaction going on in its jurisdictions. The actual computation lies within the mathematical minds of the accountants. Bottom line, paying taxes is inescapable. You may be able to elude if for some time, but eventually, you'll arrive at a dead end. The more you earn, the higher the taxes you'll be paying, which is in tune with the balancing act of nature. They say that when you set up an offshore merchant account is you'll virtually pay taxes to nothing. What happens is that your tax responsibilities are going to be reduced because the transactions will be done outside US jurisdictions. Realistically, your taxes may be lowered to a maximum of 20%. This depends upon the monthly volume transactions of your company. </div><h3 align="justify">Meeting halfway</h3><div align="justify"> If they can settle face to face, you need a third party to act as intermediary. <a href="http://www.offshoremerchantexperts.com/the_role_of_merchant_account_providers_in_an_offshore_merchant_account.html">Merchant account providers</a> and <a href="http://www.offshoremerchantexperts.com/A_behind-the-scenes_look_at_third_party_processors.html">third party processors</a> are the options to take if you want to take advantage of the features of both a domestic and offshore merchant account. A merchant account provider and a third party processor have a network of local and foreign banks to lay on the drawing board. Reasonable rates are also being given to make things more convenient but competitive at the same time. Keep in mind, that both domestic and offshore merchant accounts are open for all kinds of businesses. Whether your business is a low risk or high risk, if you want to accept credit card payments, these two are what you need. Ultimately, examine your options, don't be afraid to ask, know all the information, and go with your guts. Domestic and offshore merchant accounts will always be at odds, but at the end of the day, they serve one purpose, to serve as safekeeping tools for your hard-earned profit. <a href="http://www.onlywire.com/submit?u=http://www.offshoremerchantexperts.com&t=Clash%20of%20the%20titans:%20Offshore%20merchant%20account%20vs.%20domestic%20merchant%20account%20&tags=offshore%20merchant%20account%20domestic%20merchant%20account" target="_blank" title="Add this Article to Onlywire"><img src="http://www.onlywire.com/i/onlywire.ico" border="0" alt="" align="absmiddle" /> Add to Onlywire</a> </div>

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Clash of the titans: Offshore merchant account versus domestic merchant account

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