Credit Card Processors with API access for Offshore Companies

[OffshoreTalker]

Hello, I would like recommendations on the best Payment Processor for my needs.

I live in Malaysia, I have a service-based company incorporated in Belize as an IBC, my Customers are mostly Americans, and my Suppliers are mostly within the EU. I charge my American customers in EUR, pay my EU suppliers in EUR, and the difference are my company's earnings.

So far I’ve been using Payoneer to handle incoming and outgoing payment, but I am not happy with their service and it is too limited for my ongoing needs as I am expanding my business.

I am currently in the very early stages of a large expansion where I will expect to do approximately 2 million EUR in sales per year once the expansion is finished, so I need to automate the payments as much as possible with as few pain points as possible.

I need a payment system that:

1. will accept a person and company in my circumstances above,
2. offers low commissions like Payoneer (Payoneer has incredibly low fees such as 3% incoming credit card fees, free payments to suppliers, virtually free withdrawals, etc.).
3. offers an API to allow my website to both charge my customers via Credit Card directly on my website like Stripe AND allows me to automatically make payments to my suppliers,
4. either allows my suppliers (both individuals and companies) based in the EU to sign up easily to their system and that will allow my company to pay them easily within the system and then allows my suppliers to easily, cheaply, and quickly (e.g. SEPA) transfer that money to their account like we do now using Payoneer, OR allows my company to pay my Suppliers directly via SEPA transfer as long as it can be done via API and with low fees as well
5. has an easy and cheap option to wire transfer my earnings to my overseas corporate or personal Bank Account.
6. will not force my customers to have to upload their ID just to make a payment via credit card like Payoneer does which is a big pain point and barrier for customers just wanting to pay for a service (I received too many complaints from my customers about that, and it prohibits me from accepting last-minute customers since I can't risk organizing the service for them before the money is in my account since I will have expenses to pay for their service and credit card verifications can take more than 2 days).
7. This is not a requirement, but ideally a payment processor that allows me to customize the name of the charge that appears on my customer's credit cards (like PayPal offers) so that they can recognize payments made to my company (I had issues with customers not recognizing “Payoneer” on their credit card bills and then starting a chargeback which I then had to explain to them was actually a payment to my company which would resolve the problem but it was a big and unnecessary waste of time).

1 - 6 are MUSTS, so I need those features above because the API implementation is important to seamlessly charge Clients and pay suppliers considering my expansion will greatly increase my workload, it has to be very easy and cheap for me to pay my EU suppliers or they won't be happy, I of course need to be able to easily wire transfer my earnings to myself, and I need as few barrier to payments as possible so that I don’t receive complaints or lost sales from my customers due to payment problems.

This is a legitimate service business, so there is nothing I need to hide and therefore I'm not limited to services that do not do reporting.

I just need a payment provider that can offer all of the above for my Belize IBC. I don’t really need a debit card or crypto or anything like that, although those obviously won't hurt.

Upon researching options, it seems that maybe Bankera and AdvCash may possibly fit the bill, but I’m not sure and I don’t know if there are any others.

Please let me know about services that offer all of the above, and thank you for your help!

 

[Sols]

Scrap the Belize company. That's the #1 thing holding your back.

Why not just start a local Malaysian company and work with Stripe, Braintree, or some other local card processor? Malaysia has better card processing options than Belize.

Card processing is restricted per regions. A card processor in a region can only process for merchants in that region. Regions are usually just countries but EU is an exception. As a way around this, some payment processors create e-wallets or other forms of stored value to get around the region restriction. Some solutions use aggregated accounts, but this is a practice that the card networks don't like.

If you have volumes over or approaching 100,000 USD/month, it might be worth setting up an EU subsidiary, appoint is as a payment agent of your Malaysian company (or Belize if you insist on shooting yourself in the foot), and contract with an EU based acquirer. Depends on the exact risks involved and nature of business.

 

[OffshoreTalker]

Thanks for the quick reply, Sols. An offshore company like my current Belize IBC is necessary for tax advantages. A local Malaysian company is not an option, unfortunately. The majority of my customers are in the US, but I charge them in EUR. That is why I am looking for a payment company that meets all the criteria I listed.

Do you mean that no payment company exists that can meet the criteria I outlined?

 

[burden]

If a UK or Cyprus company can work for your needs I would quickly signup for mentor group and get TONs of good payment processors including a full guide on what and where to setup your business there.

Can be easier, all you need is only seconds away. Personally was blown away because I didn't believe that I could find a solution for my needs at that fast at the time I needed it.

they published a sneak peak here
https://www.offshorecorptalk.com/threads/quick-guide-to-get-your-offshore-business-up-running.33525/
there is a link to the full guide with names and how to's

 

[OffshoreTalker]

Thanks, but a UK or Cyprus company will not work. I already have a company and a bank account. I just need a payment company that meets the criteria I listed so that I can expand.

 

[burden]

With a UK company you will have a bunch of payment processors available! But if that not work then I don't know.

 

[MiddleEuroAsia]

Hi, one of my bases Is in Malaysia, so more or less I know where are you coming from. However, what I don't understand is the need of the belize IBC, if as what you said, your services are legit and have nothing to hide, why are using a belize corp? I guess that's none of my business, but I just kind of wonder.

I advice you to do the following, you will need to restructure your business and I'm saying that, because your business in a critical moment, where If you fucked it up, this can hinder your business growth exponentially, Also you seem like a guy who doesn't want to deal with BS, anyway you need these things:

1- a Labuan holding company, yes Labuan. ignore the voices that will tell you it's not that attractive and yada yada yada, with all due respect, these people don't know what are they talking about, yes labuan banks are not transactional, but you won't need them other than transferring the money once you receive it in you labuan bank account to your other offshore accounts. Maybe you won't even need a labuan bank account and just need the holding company. Either way, A Labuan company for Malaysian resident goes a long way.

2- this Labuan company will own two companies, one in the US and the other in Europe.

- The one in the US. This will be opened for the sole reason of collecting payments from your US clients, you will use a combination of these services for US clients:

• A) braintreepayments or similar services, since they allow your customers to pay in paypal, venmo, credit/debit card, google/apple pay...etc
• B) a bank account to go with the above. You don't need to visit the US for this step, as you can easily open an account online with one of the FDIC insured neo banks (like mercury, brex, novel, relayfi...etc ). These banks will have no issue onboarding your US company as long as you have US customers (which you do)

Now you are covered with the US side, now comes the side of the EU.

- The one in the EU. This will be opened for the sole reason of paying your EU suppliers, There are many countries in the EU where you can incorporate. However, it seems like you have no issues with privacy and hiding...etc, you get what I mean. So avoid the BS and go straight with Estonia E residency.

in Estonia you have the following:

• Clear laws and mature legal framework and overall a country that understands the nature of modern-day entrepreneurs.
• Attractive tax system. This one is specially attractive for a person in your shoes since you are expanding your business, and that means you will probably re-invest your profits into the company to grow it, and that's great since you will pay 0% taxes as long as you keep profits within the company and don't pay dividends, also you can receive up to 90% of your profits as a salary tax free from the Estonian side, and the Malaysian side too if done right.
• To pay your suppliers in EUR. It seems you don't want a merchant account for this one, so you can use a couple of neo banks like paysera (which give you an iban for your own company) and offers SEPA payments which you obviously need. You can also use Wise , payoneer, and LHV.

Now you are covered with the EU side.

For the sake of the Discussion let's call your company name: offshoretalker. Your company then will have "OFFSHORETALKER HOLDING" in labuan which owns "OFFSHORETALKER PAYMENTS LLC" (the US company) and "OFFSHORETALKER PAYMENTS OÜ" (the EU company). And you are done.

So, now all you have to do is to focus in managing and growing your business and avoid any sort of BS now and in the future.

and just a word of advice, throw the belize co in the trash. You live in Malaysia and have an offshore hub next door, so why not use it? what are you doing is just like someone who is living in the UAE but is using a nevis company, and this is just doesn't make any sense whatsoever.

All in all, these are my 2 cents and at the end of the day, it's your company and your operation, and you do you.

Good luck!

 

[Sols]

Thanks for the quick reply, Sols. An offshore company like my current Belize IBC is necessary for tax advantages. A local Malaysian company is not an option, unfortunately.

What tax advantages do you have in Belize? Malaysia has territorial taxation. Based on your description of how your company runs, wouldn't you anyway qualify for zero tax on the profits arising from the US/Europe activities?

The majority of my customers are in the US, but I charge them in EUR. That is why I am looking for a payment company that meets all the criteria I listed.

Do you mean that no payment company exists that can meet the criteria I outlined?

There are very few absolutes when it comes to business. If you have good volume, an attractive business, and the right connections, what you want or something similar can be accomplished. The 3% fee is a stretch, though. That doesn't leave much margin for the involved parties to make any money. The card network fees alone account for more than half of that 3% figure.

If you cannot expand your view beyond a Belize IBC and aren't doing high volume, you're probably out of luck. Belize is garbage. IBCs are garbage. A Belize IBC is garbage squared.

Restructuring under a Malaysia company (with an EU subsidiary) would likely be the healthiest decision for your business.

 

[OffshoreTalker]

Thank you for your detailed replies, @MiddleEuroAsia and @Sols .

My Belize IBC has been operating for several years and I have had no problems opening bank accounts and payment accounts with it since my business is demonstrably legitimate, and it is serving me well, so I have no plans at this moment to change my setup since I'm a big believer in "if it ain't broke, don't fix it." (Keep in mind also that the budget announcement for next year that was made a few days ago suggested that Malaysia's Territorial Tax System may be coming to an end in 2 months.)

Anyway, the problem is that most payment company's seem to offer their services to only a limited number of countries (mostly developed countries).

This is why I'm looking for a payment company that accepts company's in Belize and meets the criteria I mentioned in my original post, and Bankera and AdvCash caught my attention while researching here and elsewhere since they seem to meet at least some of my criteria (although I don't know yet if they meet all of them, or if there are any other company's that do).

Keeping my Belize IBC in mind for the moment, are you guys saying that no payment company exists that can meet all of the criteria I outlined? Because if that's the case, then I would indeed have to look at restructuring my setup to prepare for this large expansion.

 

[Sols]

As I said, there are no absolutes.

If you're just doing a few thousand EUR a month, then chances are you won't find anyone willing to take you on, at least not at 3%. The income a processor would earn from your business is either too small at the price you want, or costs too much for you, to be worth the regulatory and financial risks a processor would take on. They risk fines starting at 25,000 USD for these kinds of violations and are only taking home a fraction of those 3%.

If you're doing closer to 100,000 EUR/month or more, there are creative arrangements that can be made. The easiest and usually cheapest one being to set up an EU subsidiary. If the parent of the EU subsidiary isn't garbage (Belize IBC), your chances of being approved by high-risk processors in EU go up a bit.

 

[OffshoreTalker]

Thank you for the additional information, Sols.

Do you happen to know what Credit Card fees Bankera and AdvCash charge for processing such Credit Card payments?

Also, do you happen to know which of my criteria Bankera and AdvCash do not meet?

 

[Finshark]

UK LLP (no taxes) + Wise + Stripe working very well for me

 

[Finshark]

What is the stripe monthly money turnover? And where can I buy such a bundle?

About 150k-180k USD/mo, I build this setup myself.

 

[Marzio]

you can receive up to 90% of your profits as a salary

So if your OU makes 100K profit / year you can pay yoursel 90K as salary without upsetting EMTA?

 

[MiddleEuroAsia]

So if your OU makes 100K profit / year you can pay yoursel 90K as salary without upsetting EMTA?

Yes. but you have to have some sort of documents that proves the work that you are doing for your company because the Estonian tax agency might require it. in the past you had to pay a board member salary (which you had to pay Estonian social contribution taxes on top of it), and since 2019, you don't have to pay a board member salary, and you can just pay an employee (yourself) salary and you don't have to pay Estonian taxes on it, but you have to pay taxes it in your country of residence. And if you live in the UAE for example, then that means you will pay 0% personal taxes.

This specially great, because OU in Estonia are allowed to invest in a lot of sectors like stocks and ETFs, Crowd funding platforms, lending, even crypto currencies and block chain projects are accepted.

So you can have an EU company, re-invest some of the profits, and take out the rest as an employee salary tax free if you live in 0% tax country OR territorial tax country with lax PE laws and no CFC rules.

 

[OffshoreTalker]

OK, you guys were not kidding. I reached out to over 10 different payment services and it did not matter that my business is legitimate, they had a blanket ban on companies from Belize. I don't know what happened since I incorporated the company, but things have obviously gone downhill for Belize companies because not even payment services that were recommended here just a few years ago for Belize companies are accepting them today. Perhaps I might find some obscure payment services that would accept Belize companies, but then I have to ask myself if I want to be running 2 million EUR per year through such an obscure service, and I think the answer is clearly no.

So it looks like I have no choice and will need to restructure my corporate side of things outside of Belize in order to be able to get access to a reputable payment service for it. I did not anticipate this additional time sink and expenditure, but it looks like I have no choice, so I need to get this done before I can start my expansion.

Now I just need to figure out the ideal setup for my situation to be able to charge US customers via Credit Card and pay my European suppliers via SEPA with no corporate tax (also, since I'm going to have to restructure anyway, I might as well find a solution that allows me to pay my European suppliers via SEPA directly into their bank accounts via API so that I don't have to hassle all of them with signing up to a new service).

@MiddleEuroAsia Why did you recommend a setup that includes not 1 but 3 separate companies? Why did you mention taxes regarding the Estonian company when in your example you mentioned it would only be used to pay suppliers and would therefore never have revenue or profits to pay taxes on? Why did you recommend a Labuan parent holding company considering Labuan companies are not tax-free? Lastly, why does it matter that my company be physically near me considering I never need to actually visit the company's location?

@Sols Why kind of new corporate setup would you recommend for the requirements I outlined?

@Andy Wise Could you please describe your UK LLP + Wise + Stripe setup a bit more and how you make it work for you? I'm assuming you do not have customers in the UK nor provide services in the UK in order to avoid UK corporate taxes?


In my brief research, the options that sound the simplest and most cost-effective while keeping my structure tax-free but with full access to all payment services would be either a UK LLP like Andy mentioned, a Hong Kong Limited Company, or perhaps a JAFZA or RAK company in the UAE.

All 3 jurisdictions (UK, HK, UAE) seem to be tax-free for my situation and have full access to all the big players in the payment services industry.

The advantage of the UK LLP seems to be that the UK still has access to SEPA, although perhaps SEPA payments are still possible for companies outside of Europe via another payment service, I'm not sure. The disadvantage of the UK LLP seems to be that I would have to apparently pay taxes on services in the UK or to UK customers, and my expansion plans include the UK. I suppose I would have the option of running only the UK operations manually via my current Belize IBC using Payoneer to avoid that, but I would have to think about that and see if it's worth it the hassle (I suppose that will depend on whether I can make SEPA transfers using a company outside of Europe or not).

The advantage of the HK Limited Company is that it would be completely tax-free since I do not anticipate HK customers or providing services in HK. The disadvantage is that HK has been placed on the EU grey list like Malaysia has, and so it may lead to changes to its Territorial Tax System next year. That being said, it does not seem like "active income" will be effected by such those changes and only "passive income" like royalties and interest will be affected, so these changes may not impact me, but it's something I have to keep in mind. With an HK Limited Company I would need to find a service that would allow SEPA transfers to my European suppliers. I'm not sure if something like Wise offers that to companies outside of Europe, but if such services do, then wouldn't this be the best option since it would fulfill all of my criteria?

I'm not too familiar with JAFZA or RAK companies but I do know they are tax-free and Stripe offers their services to UAE, and apparently starting from last June "Foreigners opening a company in the United Arab Emirates will no longer need an Emirati shareholder or agent under changes to UAE company law" which is a positive development. But I don't know what advantage such companies would have over something like an HK company.

I'm not sure if there are any other jurisdictions for me to consider. I'm averse to incorporating in the US (unless there is some huge advantage to doing so) because I've heard and read about horror stories once the IRS has its tentacles around you considering how complex US tax law is (I dread a change to their tax law that I don't become aware of that then leads to severe penalties and interest for my US company, for example).

At any rate, now that I have no choice but to restructure my company and the world is my oyster, then considering my situation and requirements, where do you recommend I incorporate and why?

Thanks for all your continued help and I hope this discussion helps others with Belize IBC's looking to expand their business.

 

[AMD]

UK LLP (no taxes) + Wise + Stripe working very well for me

yup that could work well. Why LLP rather than LTD ?