E-commerce, (aka electronic commerce), is a type of industry where buying and selling of product or service is conducted over electronic means, using systems such as the Internet and other computer networks.
I don’t know, how about you, but I mostly shop online. At one point I would not even bother go to food supermarkets, instead do my shopping online and have it delivered to me, most of the big food supermarket chains, other shops offer home delivery for idlers like me.Internet shopping is extremely popular and convenient, as there are many services and products, that you cannot find anywhere around where ever you live and also if you just feel lazy to go somewhere.
If you have an active trading business, merchant account really is a must! Sure you can have your requisites and ask your buyers to pay through bank wire transfer, but, in reality, that is not very convenient for the buyers. Firstly, because banks add charges, secondly, it takes much longer than an instant credit/debit card payment.
Sure, you need to explore this option and decide if it is suitable and needed for your business, depending on your business model and offered services.
What is it - merchant account?
A merchant account is a certain type of bank account. This account allows you (your business) to accept payments by different payment cards, typically debit or credit cards.
Since I write these blogs mainly for offshore entities, then to be clear, I want to explain more about cases where you have an offshore entity with an offshore merchant account.
I must say the myth that offshore merchant accounts are automatically presumed to be high-risk, is absolutely wrong. Offshore acquirers (banks that offer merchant accounts are usually called acquiring banks or acquirers) usually are more lenient in sense that they offer merchant account to many more different types of businesses and the products they sell. This is also the main advantage choosing offshore merchant account providers.
Some certain business profiles, banks usually classify as high-risk. These are types of businesses such as, online gambling, adult services, pharmaceuticals, tobacco. On-shore merchant account providers classify businesses in the same ways. Why so? It is because these types of businesses have innate high-risk of chargebacks.
Chargeback - return of funds to a consumer, forcibly initiated by the issuing bank of the instrument used by a consumer to settle a debt. In short - dispute of a card payment. Chargebacks are usually raised by the cardholder in cases such as card fraud (stolen card or its details), non-delivery of goods.
Yet, offshore merchant accounts are much more expensive than onshore merchant accounts, you may end up paying double or even more per each transaction.
If you have an active trading company registered with us, and want to consider merchant account option, feel free to enquire and ask for more details. Since British Virgin Islands, Belize and Seychelles are the most popular offshore jurisdictions and companies registered in these jurisdictions are pretty much the only preferred companies, which banks would consider to offer their merchant account services to, there should be no problems for you if you wish to apply for a merchant account.
Thank you for reading my post! And you are welcome to leave comments, feedback, suggestions for other posts or contact me for more information.
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