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Offshore Banking

Offshore banking in a nutshell, is depositing your money with a financial institution which is not in your country. It is a fact that any country in the world could be a choice for an offshore account, there is a selected group of popular countries that cater to those who wish to tuck their money away in a secure bank account abroad. They often provide exceptional privacy for the depositor and substantial tax savings. Your money will be safe from the high income tax with the low tax jurisdiction. This means that your money is safe from sorts of financial instability circumstances.

In offshore countries, the low overhead cost enables you to take advantage of high interest rates. You can access to all the standard banking features particularly the savings accounts that the local financial institutions offer. Some of the other banking features that are accessible are fund management, foreign exchange, wire transfer, etc. With some jurisdictions accepting minimum deposits of as little as five hundred dollars, nearly anyone can open an account offshore. Clearly, international banking is not limited to large corporations or the very wealthy.

Why choose an offshore account?

Nowadays, having an offshore account becomes more common. There are a lot of reasons why an individual would choose to open an offshore banking account. To mention, they are privacy, profit and protection. You might find them important which opening an offshore account may be the best option for you.

Privacy

Privacy is the very first reason why most of the people have a feeling that it is a must to have an offshore account. The privacy of an offshore bank account offers a hand in hand with the level of protection that your assets receive. In comparison to a standard onshore banks, almost anyone can quite easily access your personal and financial information. Individuals can easily have an access to this information with a minimal information given. In this way, it could bring a bit of a damage to your finances.

Onshore banks by law should disclose your information to the authorities upon requesting the information. With a much higher level of privacy to the clients, this is where the offshore banks take into place. Most of the offshore accounts are situated in countries and jurisdictions that do not have such laws that they have to meet for compliance. There are a lot of offshore banks that offer an anonymous banking. This means that an individual is allowed to provide minimal personal information to the facility which helps in increasing the amount of privacy and protection that you have.

Profit

Profit is the second reason why a lot of people opt for an offshore bank account. In many places, there are a lot of payable taxes to be done when banking. This doesn’t happen a lot to an offshore bank account. However, standard banks do charge a financial institution duty tax and a bank account debt tax. They do do charge these kind of taxes and tax any interest that you might earn on your account. These kind of circumstances about these taxes are not present in an offshore banking. You remove the factor of paying these taxes to your banking institution. It is a way where you can save money and profit. Also, when you factor in that you will no longer be paying the tax on the interest you accumulate.

Banking in an offshore account located in a tax neutral jurisdiction means that you could compound your earnings. Hence, having an offshore account is definitely beneficial and profitable.

Protection

Despite what many people believe, it is neither immoral nor illegal to having an offshore bank account. Offshore banking frequently conjures images of criminals and crooks who try to hide money from the government. One obvious fact of having an offshore account is it offers you a level of protection that you cannot find with any other type of account. Those who are highly concerned about the protecting their finances and assets are the ones who do well with the offshore banking. Offshore accounts do have a higher level of protection from both government and business entities. Also, you get a guarantee that both your financial and personal information is safely kept. Offshore banks are not releasing any of your information to anyone.

Many offshore jurisdictions offer a lengthy jail terms and heavy fines for those who would disclose your information to others. In this way, it greatly protects in deterring anyone who has access to your account from releasing it.

Advantages of offshore banking

There are two major advantages you can enjoy if you engage in offshore banking, which are flexibility and accessibility.

Flexibility

This is a major advantage you can get from banking offshore. For example, there are many people who have many commitments in other countries but choose to move their money to another country. Moreover, they can pay their commitments or receive checks from a current onshore account, the charged fees are far bigger than the usual banking fees. Offshore banking is ideal for people who need a bank account that can render full services of what they require and is cost effective. An account holder to have multiple currencies transactions which makes the offshore banking flexible.

Accessibility

This is the other major advantage that you get from offshore banking. It is a fact that many individual need to transfer money from their domestic accounts to other banks that are outside the time zone of their banks operation center. There are cases like an international trading would need to receive or send payments in unusual time of day and night. With regards to this, accessibility of their bank accounts would be a necessity. If you are engage in offshore banking, you may be given with an international ATM cards. Enjoy a more advanced internet banking or have the opportunity to ask the help from a call center 24 hours which have call center operatives speak their customers language.

Disadvantages of offshore banking

Large cash deposit

Offshore banks require large sums of money as deposit, and there can be substantial annual membership and maintenance fees if you don’t understand all the terms of the agreement.

Security/Fraud Implications

Offshore internet banking exposes you to the danger of network breach or intrusion. This is because of an electronic transfer of information and stored in various databases. Breaches can cause sensitive and private information to leak out into the wrong hands. However, this is not different from losing your check book in comparison to traditional brick and mortar banking.

Spam mail

Offshore online banking means receiving emails from the foreign bank you have in offshore bank accounts. This is an opportunity for internet predators for phishing, or fish for sensitive and private information. You may see a lot of times an email in your inbox from what seems like your foreign banking institution although it is not. These are phishing emails in hopes that you login and enter your personal information such as login and password.

Knowledge of internet

A certain level of internet savvy is required in navigating the offshore internet banking platforms. This is to ensure that you are exactly getting what you want. For some elderly, this is a big reason why they shy away from conducting online banking.

How to choose an offshore bank?

There are two types of offshore accounts. They are the corporate account and individual account. Almost every financial institution charges an entry fee. The first step is determining the amount of money you want to allocate to the bank account. This is where you can accurately find out which bank is likely to accept your application. Next, the offshore bank’s location is a need to consider. It should be located in a country with safe economic and political systems. The staff at the bank should be fluent in the English language. In this way, you will have no problem communicating with them. It should be easy to travel to the bank.

What are the important things to consider in choosing an offshore bank?

Customers should find a bank that offers internet banking services. In this way, you will be able to manage the money from your native country. This will prevent you from having to take multiple flights to manage the money. Customers should check with the bank to find out the fee structures. Various types of fees apply to the offshore bank account. The bank should not charge so many fees provided that can cause you to lose money like the setup and transaction fees. If you’re a merchant account owner, it is a requirement that you check with the bank in finding out the number of commission they take for every online transaction. It is indeed a must to find out the charges for currency exchange since you are living in a foreign country.

Tips in choosing an offshore bank?

You should find out the types of financial services the offshore bank provides. The financial institution should offer the type of services that you need. You don’t need to have 24 hour access to the bank’s manager if you only want deposit some cash. It is important that the bank offers safe internet access if you plan to carry out a lot of transfers. Besides, checking the credential of the financial institution is a must.

The offshore bank must be around for many years and be established. You can ask the offshore bank to find out if it has a parent company. You can speak with the representative to learn about their historical background. The banking legislation vary from different countries. The offshore bank should not be obliged to reveal important information namely the financial and business information to the third party. However, in certain circumstances, the offshore bank has the right to reveal your bank account information. For example, a law enforcement officer can ask the bank to reveal your business information if you recently commit a serious crime. In addition, the offshore bank should not hold double taxation agreement.

If you are residing outside of your native country, the double taxation agreement will not work. You should be given an option of paying withholding tax based on the income you have accrued.

How to open an offshore bank account?

Opening an account offshore is not as easy as opening a bank account in a local in your country. Banks are under tremendous pressure in conducting a detailed and ongoing due diligence on offshore clients. As part of this process, offshore banks require a number of documents with regards to conduct an in-depth due diligence or KYC (“Know Your Customer”) background check on you as a new client.

Typically to open the account you will need:

  • A reference from your existing bankers
  • Certified copy of passports of all signatories
  • Proof of residential address (typically a utility bill)
  • Letter stating expected activity, with supporting documentation if available
  • Documentary evidence of source of funds to be deposited

The letter stating expected activity is certainly important. The bank can be expected to verify this and will monitor your account on an ongoing basis. This is to ensure that the activity on the account is consistent with the profile. If your estimate proves wildly inaccurate, your bank’s compliance department will be worried and will most likely close your account. Also, documentary evidence of specific transactions like the copies of invoices or contracts will be requested. This is especially in the case of large transactions like real estate business. It is always advisable to notify the bank in advance of out-of-the-ordinary transactions coming in. For example, if you just sold a house, or sudden changes in volume. In the case of corporate accounts, keep your bank notified of changes to the core business which may occur over time as part of the natural process of business development.

Please understand that even though your bank is asking so many questions, it doesn’t mean they think you are a criminal. Detailed due diligence procedures are part of global business today. If your banker sees a well administered account and has a good two-way channel of communication with you, that will build the foundations of an excellent and flexible business relationship with your bank.

How to open a bank account in Georgia?

Georgia is an outstanding combination of modernity and tradition. The wilderness, astonishing mountain ranges, exotic national parks comprising rare fauna and flora majestically intertwine with the sophisticated cities.

The beauty of Georgia has captured expats to start business, find a job and raise their own families in this Eurasian country. If you’re among those expats who love the caving, hiking, skiing, exploring landmarks and enjoying urban life in Tbilisi, opening a bank account is one of the first things that you need.

Can a non-resident of Georgia open a bank account?

Opening a bank account in Georgia is possible for non-residents. It has a simple process regardless of what resident you are from. However, foreigners are required for more proof of identity than the native Georgian residents.

How long does it take to process?

The process of opening a bank account in Georgia will usually take about 30 minutes. All that you’ll need to do is visit a bank, show your documents, fill out a form or two and you’re done. You may want to bring a translator if you’re not fluent in Georgian. For one thing, English language is a common language in this country, it is not a good idea to expect it. Also, you can ask for an English-speaking banker when you make an appointment at the bank of your choice.

What are the necessary documents for a foreigner in opening a bank account?

Foreigners who want to open a bank account in Georgia are required to present the following documents:

  • Application form
  • Passport and copies
  • Sample of signature
  • Proof of address
  • None of these documents are required to be Georgian, including your address.

Can I open a bank account abroad and online?

It is not possible for an individual to open a bank account from abroad and even online. However, you can still do so by retaining a local lawyer in Georgia and granting them power of attorney. You won’t have any trouble in finding a firm willing to work with you in opening an account since this is a common practice.

What banking fees are involved?

Fees are always present for everything from account maintenance to withdrawals and transfers no matter where you bank. The following fees are the most common types of fees that are discussed below. Also, it’s recommended to make a research about the individual price list of your bank.

ATM fees

While withdrawals from the ATM of your bank doesn’t charge you with any fee, withdrawals from other banks will cost you. A standard ATM fees range from GEL 5-16 for transactions from different banks.

On the other hand, foreign ATM fees can be exorbitant. You may have a debit card from your home country that does not incur fees, however these are less common in the US. The individual will more likely pay a straight fee of $1-$5 with a 1-4% of the transaction.

Normal bank fees

The checking accounts usually come with a nominal fee structure. However, you should expect an account maintenance charge that is 5 GEL per month.

Fees for international transfers

Most banks charge high fees for an international transaction. Some of them tend to inflate the exchange rate with no disclosure.

Which bank should I choose?

Georgia has a lot of banks that you can choose from, most of them are local. So, choosing a bigger international institution is possible for your personal banking. The most popular banks in Georgia include:

  • TBC
  • Bank of Georgia
  • Basis Bank
  • Liberty Bank

TBC

TBC is a massive Georgian bank. This bank has more than 455 branches and ATMs available across the

Republic of Georgia. Current account holders enjoy:

  • A GEL .90 monthly fee
  • Capability of multiple-currency account
  • Easy access to funds
  • Online banking
  • Unlimited withdrawals and transfers

Bank of Georgia

The Bank of Georgia is one of the biggest banks in the country. Also, it is one of the most trusted banks too. It has approximately 250 locations across the country. Account holders of this bank have access to:

  • The choice between a universal or standard (four currencies: GEL, USD, GBP, EUR)
  • Debit card
  • Free opening of account
  • Cash deposits and withdrawals
  • Incoming and outgoing transfers
  • Currency conversion
  • Internet banking
  • Mobile banking

Liberty Bank

Liberty bank is another popular bank in Georgia that has more 100 branches and ATMs in helping you access and manage your money. People with current accounts have:

  • The ability to bank in multiple currencies
  • Liberty debit card
  • eMoney wallet
  • eMoney VISA Virtual card
  • SMS bank
  • Mobile banking
  • Smartpay

Basis Bank

Basis bank is the fourth largest bank in Georgia. It is a lot smaller than its giant counterparts, it has 21 branches in the country. The small size of this bank means that a lot of individualized attention and service. This is great for individuals who want to keep their banking personal. Customers with checking accounts at Basis can access:

  • Useful Card (Debit card)
  • Online banking
  • Mobile banking
  • No service fees during the first year

To sum this all up, the primary function of a financial institution offshore is to provide day to day checking and short to long term savings accounts. These are the common types of accounts that most people will use offshore banks for, as it gives them a medium to store their cash. However, many offshore banks are starting to get into more conventional bank offerings. You are now able to get loans and even credit cards from offshore banks, if you meet their strict requirements.

Conclusion

Offshore bank accounts do offer a massive benefits to the right individuals since they are not for everyone. For many small businessmen and entrepreneurs, a good offshore bank account has provided the “key” or competitive edge to unlock vast potential wealth.

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2 thoughts on “Offshore Banking”

  1. Bank Account with restricted ID requirement
    Hi,
    yes accordingly my ID requirement (just only holding ID and International Driving License only), can be submitted UK bank Statement as proof of address anyway.
    I may would like to open good bank account with detail accordingly web page and Email.
    Note- this account must can be send and receive large payments at least because i’m working as private placement dealer of Cash/Bank instrument/Gold/Diamond/Bond trade. i will receive my commission from platform in USA/Europe/UK/ that’s why. normally receiving payment more than US$1-5M
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    Ruwan Nilanka
    [email protected]
    Mobile/WhatsApp-+447914505522
    SKYPE-ruwan.pathiranage1

     
  2. Hello
    i have company in UAE and i want to open offshore bank account for it without need to travel
    and also i want to open personal offshore bank account
    do you have this services

    best regards

    Dr. Magdy Salib

     

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