We liken the business of offering offshore credit card merchant account solutions to trying to rank high on Google for certain search terms:
- Google is always changing (it performs two updates every day, unannounced). Certain strategies and practices that used to help business websites rank high are now detrimental in search.
- Acquiring banks can be unpredictable, known to stop offering payment processing for certain industries, with little or no notice, often for no reason. Solutions for some high risk businesses that were once easily accessible are now difficult to come by.
By offering offshore and high risk merchant accounts, we perform a valuable service for legal and legitimate high risk merchants — to get them processing transactions online or by mail order/telephone order. More has happened in the payments industry in the last five years than the last 50. We must consistently remain in tune with the banking and payments industries to keep abreast of changes and answer the many questions merchants have.
And there are many, rightfully, but we’ve chosen the five offshore credit card merchant account questions we always get.
What are my rates going to be?
There is a reason why this is our No. 1: when we get a prospective merchant on the phone, this is usually the first question. We get it every day, several times a day. We wish we had a one-size-fits-all answer, but that’s not realistic. The answer is complicated, simply because there are many, many factors that impact offshore merchant account credit card rates. To name a few:
- KYC
- Processing history
- Financial health
- Industry type
“To give an accurate figure, we need a merchant’s data,” said Wendy Jacques, Instabill Sales Manager. “I need a full application package containing the merchant’s processing history, financials and identification before we can provide processing rates.”
What are the decline ratios with an offshore credit card merchant account?
Every consumer has likely been in a situation when, attempting to purchase something online, they get declined. Banks and credit card issuers are on the defensive these days, doing their collective best to ward off fraud.
When we align a merchant with an offshore account, they’re using a foreign payment gateway, and not all banks and issuers will allow transactions through foreign gateways — without the cardholder’s consent. Thus, the cardholder must call their credit card issuer and explain the attempted transaction is legitimate.
With high decline ratios, we strongly advise merchants include a prominent disclaimer on their website explaining that some transactions may be declined and that the customer may need to contact their issuer to allow the transaction.
Will I get my money and how often are payouts?
Most offshore banks have weekly payouts as long as the merchant is making good on his/her minimum volume per week.
A bank may say that it wants to see a merchant bring in, for example, $5,000 per week in sales volume. Therefore, with most banks, $2,500 one week and $7,500 the next is not going to guarantee a weekly payout. A merchant must be consistent with his/her sales volume to get a weekly payout with an offshore merchant account.
Will I be required to register my business in another country?
This depends on the acquiring bank with which we match your business. Some banks — mostly European banks — require registering in the country in which the merchant wants to process transactions. While some banks require it, Instabill has solutions in other countries and regions that do not.
Will it be true currency transaction?
This has become a popular question. Unfortunately, non-true currency transactions can result in chargebacks.
If you’re a U.S. merchant whose acquiring banking partner resides in, for example, Asia, this is common. When a U.S. consumer’s credit card is run through the Asian bank for a $65 purchase, that’s what the consumer is expecting to pay. What sometimes happens, however, is that the consumer is charged the conversion rate — from one currency (U.S.) to another (the Chinese yeun of Japanese yen) — in addition to the cost of the purchase.
Thus, instead of a charge of $65.00 appearing on their credit card statement, a charge of $68.77 appears, which they don’t recognize and/or don’t agree with. It leaves the consumer to wonder why he was charged an extra $3.77, and it can lead to a chargeback.
Your offshore credit card merchant account questions answered
With the oft changing landscape of offshore credit card merchant account solutions, merchants need a payment service provider that has knowledge up to the minute. Instabill’s expert merchant account managers remain up to date and will find the best solution for your business.
Start a conversation today at 1-800-530-2444.
