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Offshore Financial Licenses for International Banks

About Offshore Financial Entities (International Banks)

An attractive opportunity lying offshore from your home country may be an offshore financial institution or international bank. There are several attractive jurisdictions for setting up banking services. Typically these institutions are owned and run by corporations and individuals not citizens or nor residents of the host country. Customers are typically not citizens or residents of the host country.

An offshore financial entity is commonly set up in order to reduce banking costs by those requiring international banking services. Because of the low capital requirements and low cost of setting up and maintaining offshore financial services, it is quite possible to gain substantial profits from providing international banking services as well.

The kinds of services that an offshore financial company can offer include the following:

• Taking Deposits

Checking and savings accounts
Certificates of deposit

• Loan services
• International credit and debit card services
• Wire transfer services
• Trust account services
• Cash management services
• The issuance of financial instruments and guarantees
• Payment processing services
• Marketing of investments
• Fund management

An offshore financial institution can typically have an unlimited number of customers. There is typically no limit to deposits receivable or types of currencies in which accounts can be held. An international bank can be a lucrative investment and commonly requires less paperwork and overhead than a registered bank in the same country. An international bank will typically require less or no capital reserves. However, there will be paperwork and, as will all well thought out investments, there will be a need for well considered advice and counsel.

Making an International Bank Happen

With competent and timely advice and counsel it is possible set up an international bank quickly, efficiently, and profitably.

In setting up an international bank you will want to consider which jurisdiction to set up in. You will wish to consider the kinds of services available in the jurisdiction and which services you wish to offer.

Working with a knowledgeable company is important. There are the various choices of offshore entities. Then there is choosing the right services and obtaining the appropriate financial licenses for each services. With the proper guidance it is possible to start an international bank for around $27,000 including 50% financing of the enterprise.

Available financial services licenses:

International bank license

Other licenses

• Trust formation and management of offshore trusts and provision of trustee services license
• International asset protection and management license
• Money transmission services license
• Trading in foreign exchange/Forex license
• Trading in financial and commodity based derivative instruments and other securities - license (e.g. futures, options, interest rates, foreign exchange instruments, shares, stock, contracts for differences, etc.)
• Money brokering license
• Money lending and pawning license (personal or household unsecured, short-term loans in the range from USD$100 to USD$5,000 and must be paid back in less than one year at a maximum APR of 48%, plus different fees allowing a lot higher effective APR.)
• Money exchange license
• Safe custody services license
• Accounting services license
• Brokerage, consultancy or advisory services license

Other offshore companies requiring licensure:

• Panama Financial Services Company, forex brokerage
• Financiera, from consumer loan to real estate mortgages
• Uruguay SAFI, Uruguay Financial Services Company/Uruguay Sociedad Anónima Financiera de Inversión (SAFI)
• Seychelles CSL (Companies Special Licenses), investment company
• Swedish Credit Union, deposit taking institution in EU and a great alternaive for offshore bank license
• BVI Close End Offshore Hedge Funds. A closed ended fund is unregulated and not covered by the Mutual Funds Act in BVI and are often used as Hedge Funds, Private Equity Investment Companies
• BVI or Anguilla Offshore Mutual Funds.
• Offshore brokerage license. Government issued International Brokerage and Clearing House License which allows the license holder to engage in activities such as brokering, issuing and underwriting of securities, asset management, transaction clearing, fund management, payment processing, currency trading and financial advisory

There are a number of jurisdictions for setting up your international bank and obtaining a government issued license. Working with someone knowledgeable in the field will no only help you choose the right jurisdiction but also which licenses to obtain. Working with an expert will help you set up international banking in a cost efficient manner.

In setting up and running an international bank you can take advantage of those with expertise by outsourcing a large part of the operation. The following is a list of services that can be easily outsourced to get an operation up and running.

Management services
Qualified nominee services. Certain of the above mentioned licenses would require qualified directors or staff. A competent company can assist in providing such services in the event you would not qualify for the application.
Initiation of the application process
Development and maintenance of web pages with sophisticated functions and design
Provision of necessary banking or financial software within the different areas you would apply for.
Competent structuring or your international bank allowing low or no taxation using offshore structures and outsourcing facilities.

International banks can be an efficient means of helping individuals and corporations handle their international banking. Such institutions can also be a source of substantial income. An international bank can be set up in the right jurisdiction and in such a way as to minimize or eliminate taxes. Using the proper outsourcing assistance the owner(s) can greatly reduce paperwork, costs, and time.

In the modern word of international commerce you may well have all of your customers and suppliers in countries outside of your home nation. You may choose to bank offshore as well. The next logical step is to consider your own offshore or international bank. This step can reduce your cost of doing business internationally and provide you with additional income as well. Consult with competent counsel and look into international banking.