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Open bank account to accept funds from Virtual Terminal sales 

Opening a bank account to accept funds from Virtual Terminal sales is an ideal complement to save taxes and avoid paying high commissions for currency exchanges. To understand better the advantages of opening a bank account outside of your country of residence, we must see the differences between a Virtual POS Terminal and a bank account. 

Many people confuse the terms Virtual POS Terminal (merchant number + payment gateway) with a bank account (account to deposit funds). The difference between the two accounts offered by the banks is that the bank account collects the funds without obligation to have a credit with the bank, while a Virtual POS Terminal has a credit account with the bank (merchant account number). 

The bank is paying daily the credit operations that the Virtual POS Terminal has made by wire transfer, and that is why the bank values the nature of the business, the risk and the country where the sales have to be paid. When you contract a Virtual POS Terminal, the acquiring bank or payment processor has to transfer to your bank account the funds generated from the sales. These sales can be paid in your country of residence or outside your country. 

Pros and Cons of accepting funds from Virtual Terminal in your country of residence 

The cons of receiving funds from the sales in your country of residence are:

  • In your country of residence banks usually work with currencies that have no risk to the entity, such as, Euro, US $, GBP, CAD, AU $ and Japanese Yen. If you process with Rubles, $ HK, Singapore SGD, INR, BGN, Swiss Francs, Israel Shekel, Norwegian Crowns ... etc. then you may face the problem when looking for a bank account in these currencies in your country of residence.
  • Fiscal authorities monitor your Virtual POS.
  • The bank can consider your bank account as of high-risk and take you through verification process every time you receive processor´s transfers.
  • Your bank account is not anonymous.
  • With a bank account in your country of residence you cannot protect the funds against seizures.
  • The bank account is subject to the law of automatic information exchange.

The pros of receiving funds from the sales outside of your country of residence are: 

  • Banks in the United Kingdom, Lithuania, Estonia, Puerto Rico and Malta have more experience in card payment methods than other countries, since they are countries whose economy is based on finance. Banks in these countries know perfectly where sales come from and why.
  • The commissions for the maintenance of bank accounts are cheaper.
  • Opening a bank account to accepts revenues from your Virtual POS sales is legal.
  • The bank account where you collect funds stops being on the radar of your tax agency.
  • When you keep your funds outside your country of residence in another jurisdiction and the possibility of confiscation is equal to zero.
  • A bank account abroad opens the doors to bank secrecy.
  • You can contract credit and debit cards to make withdrawals of cash in any country in the world without restrictions.
  • You can open bank savings accounts in other currencies and not lose money by making the change.

Where to open a bank account for my Virtual POS Terminal?

Customers who need to open a bank account abroad have 2 options: European Union and outside the European Union. 

The payment system of wire transfer in the European Union works by IBAN. The advantage of this payment system is that it is very economical and the funds kept in the banks are insured for an amount of 100,000 euros. The recommended countries to open a bank account in the European Union are: United Kingdom, Lithuania, Estonia, Bulgaria, Czech Republic, Slovakia, Malta, Portugal, Cyprus and Switzerland. 

The system of payment by bank transfer outside the European Union works by SWIFT. Unlike IBAN the process is slower (2-5 days) and is more opaque. The recommended countries to open a bank account outside the European Union are: Puerto Rico (USA), Belize, Hong Kong, Singapore, and St. Vincent and the Grenadines.

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