Many businesses would like to protect their assets as best as possible.  One of the first things to look into is a bank account located offshore, preferably somewhere with a favorable jurisdiction.

When we say favorable jurisdiction, we are talking about countries and territories with tight bank secrecy laws that do not have the loopholes that you will find in other jurisdictions.  A perfect example of a country with favorable jurisdiction is Panama where only Panama courts can issue a court order before any bank in Panama divulges any information about its clients and its clients’ accounts.  Sanctions and penalties apply to any bank employee who goes against the formidable Panama bank secrecy law.

Offshore Merchant Account Charges

One of the ways by which you can protect your assets is to use a merchant account located outside of the country to do the credit card transactions for your company.  For such services, the fees charged depend on several factors such as the volume of transactions that are processed and the type of industry the company belongs to.

Initial payment for merchant accounts is around $495.00.  Merchant accounts in Panama charge fees that range from 7% to 8.50% again depending on the items, bulk of tickets, etc.  These fees are very competitive in the offshore merchant accounts industry and they could go no lower than these even if you look in countries or territories other than Panama.

How the System Works

Law firms and Panama-based lawyers can provide you services pertaining to offshore merchant account acquisition.  However, your legal representatives in Panama would need to ask for identification forms and papers even if you may be part of an anonymous Bearer Share Corporation.  Merchant account companies will require relevant documents including information on your identity and your, your principals’ and your business’ financial portfolio.

In general, offshore merchant companies in Panama forward payments weekly but it is only reasonable to expect a delay of 3 weeks before you finally receive the funds.  If you have a bank account in Panama, merchant accounts companies can immediately wire transfer the funds to your account.

What about Start Ups?

For business reasons, newly created companies are not eligible for these services.  Panama merchant accounts service providers require a threshold of $20,000 monthly billings for the past three months.  Start-up companies cannot possibly comply with this requirement.  Merchant companies will want to see billing statements for the previous months, specifically on merchant accounts, and this is something start ups will not be able to provide right then and there.

Risk of Closure

One important thing to keep in mind is the risk presented by accruing chargebacks on your account.  The funds are normally held for about 6 months for the purpose of paying off charge backs which come in at a later date.  This is part of the contract that you will sign with a Panama merchant accounts provider.  If the chargeback amount becomes inordinately high, you will risk closing your merchant account.

If you are interested in opening a merchant account in Panama for asset protection purposes, then you’d better approach a Panama-based legal firm for legal counsel and assistance.