Opening an offshore bank account is just like opening a bank account. The main difference is the location of the bank and the banking services offered.
Offshore banks are banks that are located outside a country other than the account holder’s country of residence. These are specifically licensed by their jurisdictional authority to offer offshore banking services. Offshore banks are known for the wide range of benefits that they offer to account holders vis-à-vis retail bank accounts. Before choosing to open a bank account it is very important to understand the various considerations.
Many offshore banks offer a full range of private banking services but have certain terms and conditions that need to be met. 7 things you must know before opening an offshore bank account is as follows:
- Consider your needs:
Before choosing an offshore jurisdiction and account, you will need to consider the requirements as objectively as possible such as do you need to make international payments or do you live outside your home country, or do you move regularly between different countries, etc. The client must not only consider the current needs but also possible future requirements. Moreover, an offshore bank account is usually associated with minimum deposits or assets under management requirements.
- Considering the offshore bank’s jurisdiction:
The offshore banking jurisdiction should fulfill certain important criteria such as a history of political, economic, and regulatory stability including tax and inheritance structures, an established pool of private bankers, wealth managers and legal and financial specialists and service providers who have experience catering to the needs of high net individuals. Zero or low rate of direct and indirect taxes. The presence or absence of double taxation agreements or tax information exchange agreements between jurisdictions.
- Consider the bank:
Check the different banks that offer offshore services in the chosen jurisdiction. The client may favor a brand whose name one is familiar with or maybe looking for a bank that offers you the specific features and benefits that you are looking for. When you decide, check whether the bank has experience with international clients. Banks that have mainly local businesses may not have expertise in a highly complex regulatory environment for international banking. Banks that have an international presence and expertise will help you in opening an offshore account from the comfort of home.
- Consider the product or service bouquet offered:
The offshore bank should be able to offer you a suite of products and services that will help you effectively in managing the international holdings, optimizing the taxes and protect your assets from creditors, estranged spouses, or other family members, structured transfer of assets to the younger generation of family and ensure continued ownership of business without fragmentation.
- Consider worldwide availability or accessibility of services:
The client must determine the global availability and accessibility of the offshore bank’s product and services through sample questions such as do you have access to global markets or global range of products and services, do your bank’s product have global validity and acceptance, do you get worldwide product and customer support, etc.
- Bank fee’s structure:
Offshore bank charges fees on the flat fee model i.e. this could be a percentage like one percent of total assets under management. This bank fee usually covers all transactional, custody, and advisory costs. There may be a different fee structure depending on the products or model, advisory, and discretionary management services. Individuals may take time to understand the bank fee structure so in such a case get your relationship manager to explain everything in detail.
- Cater to privacy, security, and confidentiality:
The new era of digital banking channels like the internet and mobile banking have given customers the anytime anywhere convenience. While you will need to practice some good security habits and make sure that the offshore bank is safe. These measures are like include multiple security layers that include login username and passwords, security devices, instantly generated passcodes, etc. Application of additional security layers to all financial and important non-financial transactions.
Choose an institution like Great Southern Bank and enjoy the benefits that come with banking in a stable setting with a bank that will serve you with best and better.