Offshore banking is beneficial in many ways. It makes it possible for international as well as domestic companies to bank in an alternative jurisdiction to facilitate international bank transactions, trade and asset protection.
Offshore banks are very well equipped with top of the line electronic facilities that enable them to provide their services and attend to their customers’ needs. Banks offshore provide a broad range of banking services that assist customers in managing their financial affairs.
Offshore banking is an activity that is rigorously regulated by both domestic and international institutions. To protect both customers and the banks themselves, regulations are imposed so that certain standards are adhered to by the banks as institutions and their staff, as well as by customers to ensure that transactions are transparent. As a result of this, both offshore banks and customers are expected to meet specific due diligence requirements.
In order to offer their offshore banking services, offshore banks must first be licensed by the jurisdictions in which they operate. There is an application process and due diligence procedure that an offshore bank must go through in any jurisdiction. These procedures and requirements for conducting offshore banking business differ from one jurisdiction to the other. Offshore banks have to meet certain solvency margins are usually licensed according to the type of banking business that they intend to conduct; hence why general and restricted offshore banking licenses are issued, including different classes of licenses.
Banking offshore services include the provision of diverse offshore accounts, namely merchant accounts, savings accounts, checking accounts and business accounts (to give a few examples). Generally, these accounts are denominated in various currencies, and can therefore be held and managed in multiple currencies. Private banking is another service that is part of offshore banking and helps customers with managing and administering their wealth. Private offshore banking services are often solicited by very wealthy individuals that require ways in which they can invest their monies and be assured of returns in the long or short term.
One of the advantages of offshore banking is the privacy that customers receive. Privacy is important in that it allows account holders to take legally sound discreet measures to invest on a global scale, safeguard their wealth and minimize their tax burden.
Offshore banks provide their services only to non nationals and non residents of the countries where they operate. An offshore bank is exempt from all local taxes, as well as tax on international income and profits. This helps make it possible for offshore banking institutions to operate profitably and reduce the charges that customers pay for services.
Offshore companies, like Belize companies, in particular are able to maximize their efficiency in terms of trade, transactions and reducing taxes incurred from operating on a large scale. Banking offshore can thus be regarded as being complementary to owning an international business company so that business activities can be conducted effectively. Banks offshore can be used as a platform for international business and for facilitating the receipt and making of payments.