By definition, offshore banking means to use the services of some bank that is located outside the depositor’s jurisdiction or in a country different from where the depositor resides. One of the best reasons for having an offshore bank account is that you will be able to enjoy some tax relief. The concept originated from the habits of the UK residents to open an account in the Isles of the British Channels, which offers some very attractive tax benefits. That’s how the word was coined. The islands became hot favorites for all countries to start banking with them due to the tax advantages and their regulations.

Since their governments are laxer with their rules, offshore banking is subject to fewer regulations. There are more ways to open accounts in offshore banking and more ways to manage them. Such banking moves about ,000,000,000 each day around the globe. There were only a few such banks at that time.

Offshore banks also provide the whole gamut of services that a local bank will provide. It allows for both kinds of account, checking or savings, either in a personal or corporate format. In addition, online banking is provided. Some of these banking accounts will provide anonymous accounts for more privacy.

Other features that some of these offshore banks provide include investment management and custody. You can also get services like trustee services, corporate administration services, foreign exchange and fund management. But you need to check – since these banks can be either commercial or private banks, all these features may not be present with all banks. If you want more banking features that are better for your money, you should opt for commercial banking. Personal banking, while expensive, provides a set of personalized features that clients can use.

Due to the fact that offshore banks do not have to divulge your private or business details to anyone, your confidentiality is maintained to the best extent. However, if some criminal involvement is proved on your part, your offshore bank will reveal such details to your government or tax departments. It is not possible for them to reach at your offshore banking account in any way – through a suit or through seizure – until the time they find out about it.

For your country, these offshore banks are known as tax havens. Tax relief is a major benefit obtained from offshore banking. When you get the money and other assets from the offshore bank to your own country, taxes may be applicable. Another benefit of offshore banking is asset protection. The risks of becoming a victim of invasive bureaucracy, seizure of assets and lawsuits are much reduced when you manage your assets through offshore accounts.