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Offshore Banking: Why Millennials are looking for options overseas?

Every millennial is now on the race to acquire a state of financial stability sooner, rather than later. With increasing cost of living, climbing house prices, the need to save money for rainy days, many millennials are planning to set up a savings account in overseas banks and institutions. This very facility is called Offshore Banking. But the question is, is it safe, secure, legal and right way to save one’s hard earned money?

Contrary to the popular notion, Offshore banking is not restricted for only the super-rich. Any average person, with proper professional advice, can open a completely legal Offshore bank account within a matter of few hours. Offshore accounts are not under the protection of the Financial Services Compensation Scheme (FSCS), whose function is to protect savings held with authorised UK banks and building societies, up to £85,000 per person.

A large number of account holders in order to protect their wealth on a daily basis are deciding to choose offshore banks. Minimizing tax burden, high level of privacy, around-the-clock availability, currency diversification, and more and more, are some of the many advantages of having an Offshore account. Offshore banking offers many potential benefits such as earning higher interest rates and tax benefits, ability to bank in foreign currencies, etc. This is particularly beneficial to those who often travel overseas for work or leisure since it provides the facility to receive multiple currencies without having to pay for exchange fees. This also safeguards one from the exchange rate fluctuations. This sense of security gives the account holder a confidence to choose offshore banking even though they are not extremely wealthy. It also offers greater asset protection against future uncertainties and threats such as divorce lawyers, creditors and legal actions which at times cost a lot of money, offshore banking will provide a secure solution for managing one’s money well. While offshore accounts could provide a tax-efficient way to save and invest, you need to disclose your income to any relevant tax authorities and declare any interest earned on offshore accounts. Some offshore accounts charge for international transfers and have monthly fee. Others don’t. All of these perks will be subjected to the rules and regulations of the country which harbours the bank. For more security and reassurance, many banking jurisdictions offer strict, financial privacy and confidentiality agreements and ensures that one’s information is not shared with any third party and one’s assets are shielded to safeguard one’s information. Here are some aspects to be considered before opening an Offshore account: Reputation shows the jurisdiction and banking system quality. A well-reputed banking country will bring in highly pro-business and stable environment. However, it can be quite challenging for how easy it is to deal with if one is a foreigner open bank accounts by oneself in such countries. Usually, due to its complicated requirements, more efforts will need to be made to open an offshore bank account in these places. A large number of foreigners especially for those being start-ups, entrepreneurs or SMEs, may think of Low Deposit as the key factor to find their best offshore bank account. Some offshore banks even do not mandate the requirement of initial account for opening a bank account. Some banks require the deposit minimums for foreigners at a minimal cost. The timeframe of most offshore banks for the account opening process is quite similar to each other. Typically, it can take you only several working days to get your accounts opened.

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Goldman banker hired by the Citi bank

Citigroup has hired Luisa Leyenaar-Huntingford from Goldman Sachs. This new hire is to co-head its global infrastructure franchise. Because, it seeks to win more business from cash-rich investment firms focusing on infrastructure deals. Leyenaar-Huntingford will be based in London. Responsibility will be shared with Todd Guenther in New York.

The pair will work closely with industry teams covering healthcare, industrials, natural resources and clean energy transition (NRCET), technology and communications. Leyenaar-Huntingford helped in the establishment of the Goldman’s infrastructure franchise in her time at the Wall Street bank. They will team up with Citi’s Iberia co-head of banking, capital markets and advisory (BCMA) Jorge Ramos will continue to be a senior member of the global infrastructure franchise.

The infrastructure sector is poised for further growth, according to the memo. The memo was released by Citi’s global co-heads of the alternative assets group Anthony Diamandakis and John Eydenberg, and its EMEA head of BCMA Nacho Gutierrez-Orrantia. There was significant private investment demand across the globe to deal with environmental, energy, transportation, waste, communication, digital and other social needs.

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Banks make slow progress on UK gender pay

Major banks in Britain made a slight dent in their gender pay gaps. Several insurers went backwards. Companies in Britain with more than 250 employees have been required to publish the difference between the pay and bonuses of their male and female employees. They got a reprieve due to the pandemic, last year. The financial services sector has shown one of the largest genders pay gaps in Britain. The lack of women in senior jobs is the main reason.

Pay gap data from 21 major financial institutions showed a narrowing in their average mean gender pay gap. This is just 0.4 percentage points. Banks alone had a pay gap which narrowed by one percentage point. Ann Francke, chief executive of the Chartered Management Institute said that the UK’s financial services industry has often been singled out. It really does have to get its house in order. Goldman Sachs had the widest gender pay gap in the year to April 2020. Goldman posted a gender pay gap of 51.8%. The bank told the staffs that narrowing the gap further was a critical priority. A spokesperson for banking lobby group UK Finance said, that there is clearly more still to be done.

FTSE 100 insurers Prudential, Legal & General and M&G reported a widening in their pay gaps. Prudential’s UK gender pay gap widened to 45.2%. M&G also reported a widening in its pay gap in the most recent year to 30.5%. The M&G spokesperson said that they are determined to narrow their gender pay gap and will do this by achieving better representation of women in all roles at all levels of our organization. Legal & General’s mean gender pay gap widened to 30.8%.

The insurer said that the legal & general is tackling the underlying causes of its pay gap. This is by creating a more diverse workforce and a more inclusive culture through sustained, long-term action. Admiral had a gender pay gap last year of 12.8%. The 21 firms surveyed were Barclays, HSBC, Lloyds, NatWest, Standard Chartered, Bank of America Merrill Lynch, Goldman Sachs International, JPMorgan, Morgan Stanley, UBS, Credit Suisse, Deutsche Bank, PGMS (a Phoenix unit), abrdn, Schroder Investment Management, St James’s Place, Legal & General, Prudential, Admiral Group, Aviva and M&G.

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BOJ to lower inflation target-Japan’s finance minister

Japan’s outgoing finance minister, Taro Aso, said that he had proposed lowering the central bank’s 2% inflation target. This is when the prices took a hit from plunging oil prices. He was the finance minister for nearly nine years. The slump in oil price was among the main reasons the government could not officially declare an end to deflation. In his final news conference as finance minister, Aso said that he proposed to Governor Kuroda that, with oil prices falling this much, it would be hard to achieve 2% inflation. Hence, the target must be lowered at some point. He stated this by referring to Bank of Japan (BOJ) chief Haruhiko Kuroda.

Aso also said that the governor said he would do his best to achieve the target. This is stated by adding that policymakers must scrutinise at some point, why the BOJ’s inflation target of 2% has not been met. The remarks highlight how the government and lawmakers distanced themselves from the BOJ’s target years ago, despite central bank reassurances that achieving the target was possible by maintaining or increasing stimulus.

Aso was deeply involved in negotiations with the BOJ. After Kuroda took over as governor, he deployed a massive asset-buying program. This is for pulling Japan out of deflation. Aso supported the BOJ’s stimulus efforts. He is a member of the cabinet. And also, had raised many doubts that monetary policy alone can reflate the economy out of the doldrums. New Prime Minister Fumio Kishida is set to form a cabinet.

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