A high risk offshore merchant is an individual who operates a high risk commercial enterprise and for that purpose he requires to have a high risk merchant account. Since such an account may not be provided by any of the existing financial institutions within the country, the merchant may have to open it in some other country and this account is referred to as a high risk offshore merchant account.

The high risk offshore merchant account is offered by offshore banks which do not impose too many account restrictions as may be placed by the native banks. These accounts are tax-free in nature, are available round-the-clock for trading which can involve a number of currencies and also grant offshore benefits to the merchant.

High risk offshore merchant account is convenient since all that is required is the possession of an offshore trading company and a bank account in the name of the same company. However, due to the nature of the business the initial set-up cost along with the discount rate and the transaction fees is higher and one also needs to be prepared to make a cash deposit upfront or submit information as regards an ongoing cash reserve.

A trader who possesses a high risk offshore merchant account stands to benefit from it in a number of ways like tax, security, privacy and multi-currency international trading. In addition, the merchant can make a settlement in the currency of his choice and there are absolutely no restrictions in terms of the number as well as the size of transactions.

High risk offshore merchant accounts are generally the domain of the wealthy as well as the international businesses and while choosing an institution for opening this account the important criteria for the merchant are the credit rating of the bank, confidentiality and straightforward procedures.

Likewise, the offshore banks also have certain yardsticks which have to be met by the merchant prior to opening of the account. The first yardstick is the nature of the business as well as its potential for future growth and the second yardstick is the determination of the risk in terms of charge-backs, legal violations and financial liabilities to be incurred by the bank.

Sometimes a business owner may be fortunate enough to come across a golden opportunity for opening a high risk offshore merchant account with very low transaction fees. Although such offers are very rare, they can prove to be the requisite foundation for a successful commercial activity as they provide all the facilities without charging any fees.