If you think an offshore banking is only about monetary scams and a way to hide profits from under-reported business earnings then you are not the only one to think so. Even today many people are still a bit skeptical to open an offshore account as they fear that the tax authorities might pay a visit if they found about an offshore account, which certainly is not the case.

Generally speaking, any bank account opened outside your home country is considered an offshore bank account. There is usually not much difference in service or benefits between the bank closest to you and a bank located abroad. An offshore bank account can be established with minimal effort. Many banks allow you to start an account by mail and over the internet.

The advances of globalization and Internet facility have allowed for greater benefits to offshore bank account holders. Such bank account can provide you with an opportunity to help guard your money and to potentially gain higher returns. Although the level of security and opportunities for higher returns will vary with each offshore bank, you can expect to find one that best suits your needs with a little basic research.

Following are the key advantages of having an offshore bank account:

Little or No Tax: One of the many benefits to have an offshore bank account other than your home country is that you do not have to pay tax. These accounts tend to have little or no taxation. This is done to encourage you to send your money to foreign banks. It is in fact a win-win situation for both because bank will benefit by getting access to your funds and you will be preferred by avoiding having these funds taxed.

More privacy for your money: Many offshore banks have strict rules for disclosing private information. This is great news for people trying to keep their money hidden against creditors. This can be an effective source for keeping your money hidden from private matters like divorces and lawsuits. However, there is currently a trend where some offshore banks are providing information when there are calls to do so based on serious crimes or acts of terrorism. Each bank has different rules regarding these particular issues.

More security for your money: Many people will put their money in an offshore account because of the instability of their home country finance condition. Fear of their money being frozen or even nationalized encourages people to send the money abroad to avoid these issues.

Better interest rates: Offshore banks tend to have a lower overhead due to less government regulation. This translates into them being able to offer high interest rates than domestic banks which tend to have higher operating costs.

Convenience: With e-mail, telephone, Fax and internet banking, your money is easy to access, and you can easily make electronic transfers to a bank of your choice. This is more convenient especially if you travel for business.

Following are the key advantages of having an offshore bank account:

Asset Protection

Confidentiality Benefits

Decreased Tax Liability

Potentially Higher Interest Rates

Easy Access to Deposits

Protection against Home Country Political or Financial Instability

Diversify business investments