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What Are The Documents Needed To Apply For An Offshore High-Risk Merchant Account?



This news story was published on January 5, 2022.
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Are you looking to open an offshore merchant account? Well, getting a merchant account isn’t a piece of cake, particularly for a high-risk merchant. It means if your business comes under high-risk categories, such as tour and travel, Kratom, CBD, etc., you have to put extra effort into a merchant account.

The majority of business owners lack time to put in these efforts. So, they hire a high-risk processor to look after these things. So, begin with looking for offshore high-risk merchant account providers. Then they will help you with an offshore merchant account. You might need a lot of documents in it. So, to stay prepared beforehand, you should know the required documents.

This article will help you with it.

Documents for Offshore Merchant Account

A merchant account requires several documents that go through various verification processes. Besides, each country has different rules and processes for acquiring a high-risk merchant account. The objective of mystifying the whole opening process is to avoid fraud and undesirable people applying. 

Here are some of the documents that most offshore high-risk merchant account providers ask for.

  • Merchant Account Application

Your provider will give you an application form. You have to fill it in carefully and sign it.

  • Any Identification Proof

Identification proof is an essential document for a merchant account. Without any valid identification proof, you might not get approval for a merchant account. Some identification documents include a driver’s license, International passport, or National ID.

  • Photo Identifications

In the case of photo identification, you have to provide valid photo identification. If the business is in partnership, submit a photo of all the owners with more than 10% share in the business. The acquiring bank needs information about who has a majority share in any business.

  • A Voided Check

Give a voided check that contains the exact name of your business. The check also assures that you have a valid check account with your business name. 

  • A Utility Bill

You have to submit a utility bill, such as an electric, gas, or cable bill. However, make sure that the bill is not more than three months old when you submit it with your merchant account application.

  • Business Bank Letter/ Business Bank Statements

Most offshore high-risk merchant account providers require a bank statement of the last three months, ensuring that your business is functional and operating. Besides, if you are a startup that has not begun transactions, you can submit a business bank letter instead of business bank statements. 

  • Credit Card Processing Statements

If your business accepts and processes credit card transactions, you have to submit three months of statements of credit card processing. These statements also show refunds, chargebacks, and volume your business does. 

  • Website and Other Marketing Material

For a business with a website, it helps the merchant account provider to understand your business extensively. If you can’t have an online presence, you have to submit marketing material and other business plans that show your way to drive sales. 

These are the documents that most providers require. There are several other documents that you might need.

Other Documents you Might Require

Here are some of the other documents you might need for an offshore merchant account. 

  • Recent (almost 12 months old) certificate of good standing (if applicable)
  • Certificate of incorporation
  • Articles and memorandum of association.
  • Constitutional document (if applicable)
  • Certificate of incumbency
  • Certificate of secretary or equivalent 
  • Certificate of directors 
  • Certificate of registered office or equivalent
  • Certificate of shareholders or equivalent
  • Copies of international passports of authorized signatories, directors, registered shareholders, or beneficial owner(s) / identity cards.
  • Partnership deed or agreement (if applicable)
  • Proof of group principal trading officers’ business address
  • Proof of permanent residential address of the Directors, Shareholders, Secretary, Signatories, Settlor, Ultimate Beneficial Owner/s, Partners, Trustees, Attorney, and Protector and other related parties of the company.
  • Utility bills that are not more than 6 months old
  • A short CV of authorized signatories and ultimate beneficial owner(s) (if applicable)
  • Copy of license (if applicable)
  • Trust deed or other similar instruments (if applicable)

Most of the time, accepting, processing, and opening a merchant account takes days or weeks, according to the country. Another factor responsible for a delay in merchant account opening is the type of business. Most financial institutions take the help of KYC or “know your customer techniques. It helps the merchant account providers to verify and confirm that they are not dealing with a questionable client.

Why Offshore Merchant Account?

An offshore account is nothing but a merchant account with its offshore payment processor acquiring a bank in the area outside of the primary headquarter of the business. For instance, if a business in the US establishes a payment processing business in a country in Europe, that merchant account in Europe is known as an offshore merchant account.

You can say that an offshore merchant account is similar to an international merchant account. However, there is a hairline difference between the two. Most of the time, US acquiring banks consider offshore merchant accounts high-risk ones. 

On the other hand, an international merchant account is for everyone, high-risk and standard ones with a want to expand their business to a global level. High-risk businesses prefer an offshore account because of various reasons. Some of them are:

  • Most high-risk businesses do not qualify for a merchant account in the USA because of the service or product. In such cases, they prefer offshore merchant accounts in a country with friendlier jurisdiction. 
  • Most international banks offer comparatively more processing volumes than US banks. They generally do not have a volume cap, ensuring fast growth.
  • Some high-risk businesses set up offshore merchant accounts for business incentives provided by particular countries, take advantage of regulatory environments, etc. They could also prefer an offshore account for tax purposes. 

So, if your business falls in the high-risk business category, you can opt for offshore accounts for better business growth. You can take advice from your business advisors regarding the payment gateway that is fruitful to you. 

Conclusion

With globalization, no business is limited to a country. Everyone wants to make a place in the global market. An offshore merchant account can be a significant step in your dream. It gives you several benefits that take your business to higher levels.

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