Offshore banking is described as using the services of a bank based in a jurisdiction or country other than the one where the depositor resides. Offshore banks are normally based in countries that are called tax havens, and they provide extra secrecy and protection to depositors.
The word “offshore” comes from the British Channel Islands, which are tax havens situated simply on the other side of the English Channel.
These were the first tax havens, and it was they who coined the word “offshore” to describe the industry.
Because of the tax advantages and legislation, those islands became major international banking centers.
They were ideal locations for storing assets abroad or saving and investing.
Since their governments impose less controls, offshore bank accounts are also less restricted than domestic bank accounts. This opens the door to more forms of offshore banking accounts and ways to exploit them.
Offshore banking has developed into a multibillion-dollar industry with $2 trillion in daily transactions. That’s a far cry from only a few decades ago, when there were just a few offshore financial hubs, most of which were shrouded in legends about drug money and illegal activity.
What programs are offered?
You can get a full range of services from your offshore banking hub, just as you can from your regular domestic banks.
Personal and corporate checking and savings accounts are among the options available. These offshore financial centers also provide safe internet banking services that allow wire and electronic funds transfers, worldwide acceptance of debit and ATM cards, credit cards, loans, and mortgages. Some even go so far as to have Anonymous numbered accounts for added privacy.
Some banks also provide investment management and custody services. Corporate administration, trustee services, fund management, and foreign exchange are also available. Since banks tend to specialize in retail and private banking, not all of the services listed may be available at every institution. Retail banks are more cost-effective and have standard services. Although private banking services are more expensive than retail banking, they prefer to provide more customized services to their clients.
The Benefits Offshore banking
Since offshore companies are under no obligation to disclose any of your personal or business details, privacy is the first thing that comes to mind. Your information will not be shared with any governing body or tax authority until proof of your participation in illegal activity can be shown. They can’t sue over or take anything they don’t know exists, basically.