THE STEP-BY-STEP MECHANICS OF SIGNING UP FOR YOUR "OFFSHORE CREDIT CARD VENDOR STATUS"
The first step is to apply for the Merchant status. This can be made by writing us a free format email stating the name of the applicant and the contact email. What we also do need to have from an applicant is a more or less protracted BUSINESS PLAN stating the character of sold services or products, the expected size of a typical transaction, the expected size of the weekly/monthly turnover, as well as any info you may believe to be relevant. The essential things for the bank to know is whether the merchant is going to let his/her customers sign authorisation slips and to obtain card copies from them. Applications are considered on an individual basis. Bank may ask some additional questions and will normally send an answer within 5 working days.
After preliminary approval, you will be requested to transfer funds to our account so we can proceed with setting you up. Before applying, please note that:
bank serves most credit card transactions; currently, bank can serve only corporate customers.
Procedures and fees:
Should a positive answer be given in respect to the merchant status application, the bank provides applicant with the necessary information and tools for the beginning of work. In any case, the bank will require the placement of a SECURITY DEPOSIT. Its size depends on the character of the business outlined in the applicant's plan but cannot be less than $5,000. The permitted monthly limit of transactions to authorise will constitute a certain percentage from such deposit. Clients that will be able to provide the bank with signed authorisation slips and copies of credit cards will be permitted to place lower deposits and to clear a higher percentage of cards.
The processing fee is 6%, the minimum charge is $0.50 per transaction. Funds are cleared to the client's account within 6 banking days.
FAQ EXCERPT: CREDIT CARD MERCHANT STATUS
Basic set-up:
A) You can work your corporate account via any normal phone line.
B) No costly electronic POS terminal required, no exorbitant yearly upkeep fees: simply dial in or send cc data by encrypted email (PGP supported) to get clearance.
C) The bank's commissions deducted from your turnover are subject to volume. For starters however, commission will be 6%. Typically, funds will be partially blocked for 4-6 months, with a certain percentage in relation to your initial security deposit being released per month. Note that this is the initial agreement: depending on volume of sales, chargeback rates statistics and general evolution of business, new terms may be negotiated after approx. half a year or so.
Q: Which credit card companies are supported?
A: Currently most of the major credit cards are accepted for processing.
Q: How do I have clients' credit card data checked and how do I get a clearance number or card verification?
A: Forward credit card data to the bank (by phone, fax or encrypted email), received clearance from them and have your merchant account credited, that's all.
Q: Isn't this procedure a bit cumbersome for online credit card orders?
A: While you may accept online credit card orders on the Internet, note that this is no instant credit card verification as offered by many electronic vendors in the U.S. While we expect this to be implemented some time in the foreseeable future, it is not yet very common outside the U.S.
- even the world's leading industrial nations do not generally offer this service. Also, instant online verification is hardly feasible for an anonymized offshore corporation: business would be immensely traceable, high profile auditing and check-ups are mandatory and chances are that traffic may easily be surveilled by tax authorities. If you're U.S. based and want to start or continue doing open onshore business with online credit card verification, these programs will probably not be viable for you.
Q: Is there any blocking necessary on the merchant account to operate (they practice this in some banks)?
A: Yes, this bank will typically insist on partial blockage for about 4-6 months. However, funds will be released at a certain rate per month during this span. This is the initial format - later, once a satisfactory business relationship has developed, new terms may be negotiated.
Q: Would I then be able to use this set-up to pay directly into my own debit card account?
A: Yes, client would be debited, your account credited automatically.
Q: What currency would I have to charge my clients in?
A: Normally, charges will be converted to local currency, as those are the cc companies' international regulations.
(In some countries this has to do with local currency restrictions as well, though not in this case.) However, when verifying cc order data, you may quote in US$ and the bank will convert automatically for you. If you keep your currency account in US$, you will, of course, be credited in dollars.
Q: What do your fees cover exactly?
A: Apart from items and services specified above, fees will also cover all local paper work, technical questions (such as whom to call and when and where), on site set up support (liaison work), formal agreements, information about new and pending developments (credit card companies can be pretty mum about this), advisory work &c. Also, as it stands, this program is the product of special negotiations and is our exclusive offer - you won't get it anywhere else outside of our agents' network!
Q: I presume I could I be issued with a debit card on that account?
A: Yes, a personal major debit card is included in all three programs. Hence, you may enjoy your (tax-free) profits via this convenient instrument. You may purchase goods worldwide wherever credit cards are accepted, and you can even withdraw cash from any ATM offering this service.
Q: What is the credit line for these cards?
A: Basically, the debit card offers a 100% credit card minus a nominal sum for administrative extras (such as foreign currency charges &c.). So if your account holds say US$ 20,000, you may expect to be able to withdraw at least US$ 19,500 or more.
Q: Can I use this debit card to pay for online orders as well?
A: If by "online orders" you mean set-ups featuring instant cc verification or approval, the answer is: unfortunately not. As per now, the issuing credit card company is reticent to allow online orders. This may be subject to change sometime, but at the moment we cannot tell you otherwise. However, if you wish to purchase items from an Internet vendor offering secured transactions but no instant verification, this is quite possible.
Q: Can't I get a regular credit card instead?
A: If you don't want a debit card for some reason, you may alternatively opt for a secured credit card, yes. Here, collateral will be required in the usual ratio of 100:150. In other words, if you wish for a monthly credit line of US$ 10,000 you will have to put US$ 15,000 in account. Minimum deposit is US$ 6,000. If you opt for this, we will set you up for a secured credit card instead of a regular debit card without surcharge.
Q: Can I obtain a Gold Card, too?
A: Yes, that is possible, too. The same procedure applies as for the regular secured credit card, but minimum deposit will, of course, be higher. This service will be surcharged by US$ 350.
Q: Is it possible to use an existing trust domiciled in another country (e.g. Japan?) in lieu of the Panama Corp?
A: Sure, no problem. It won't get cheaper that way, because it's different documents that will have to be translated, notarised & legalised locally (i.e. not the usual standard fare), incurring greater overhead; but yes, existing corps and trusts can easily be employed. See our Offshore Merchant Program #3 above for the details. Please bear in mind that the issuing bank will need the ORIGINAL company or trust papers, as they cannot be notarised otherwise. Also, possible tax issues should be taken into consideration. A Panama Corp operating outside the USA with a European cc merchant set-up & bank account, but operating outside Europe as well, will not be subject to taxation in either Panama or the Europe. This may or may not be the case with your Nippon trust in Japan proper. So if your Japanese trust structure offers the same advantages, go ahead. If not, you can always opt for the standard solution, as described in our program info.
Q: How about cc fraud issues? Who will pick up the tab?
A: The upshot of the matter is that the fraud risk will be the vendor's, not the bank's, not the cc Corp's. But then again, this is standard procedure internationally. Granted that this is not a very fair set-up, but unfortunately it's a tight situation for any applicant anywhere in the world these days, and viable offshore venues are almost impossible to find or - if at all - unaffordable and not lucrative by any standard.
Q: What is their notification procedure on a chargeback?
A: CC Corp notifies bank, bank notifies vendor. Generally, there's no way around it: in the end, the risk IS yours. But that's the same story practically everywhere in the world: insurance and security hype aside, what it boils down to is that you will have to arrange yourself with the cc Corp and/or the bank in some way or another. It is always advisable to let your customers send you a credit card authorisation SIGNED IN WRITING - that will grant you considerable leeway in case of chargeback or fraud issues.
End of FAQ "Offshore Credit Card Merchant Status
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