- An offshore banking is one which is located in a different jurisdiction from its investors or depositors reside.
- Onshore Banking is the banking activities which are undertaken within the jurisdiction and territories of a nation or a sovereign state.
Privacy and Secrecy
- In offshore banking, authorities, regulators and even governments cannot access information except few exceptions.
- In onshore banking, there is a standard privacy and security policy.
- In offshore banking, the stability remains neutral in any situation like wars, economic up-down, rules and regulations and political changes. All this are not going to affect the account.
- In onshore banking, all type of adverse conditions affects the account.
- In offshore banking, the initial deposit is in large amount.
- In onshore banking, the initial amount is much lesser than the offshore banking account.
- Offshore banking is highly flexible because it serves the specific services as per their need. It has a high level of personalization.
- Onshore banking is not flexible but it provides services up to a certain extent of personalization.
Reputation of Client
- Offshore banking has a high level of goodwill because of high net worth customers who deal in international trade.
- Onshore banking has a normal level of reputation in the market because the customers are from the national boundary.
Eligibility of Customer
- Only non-resident individual can open an account in the offshore banking.
- In onshore banking, the standard eligibility requirement is followed.
- An offshore bank account has no tax or a negligible tax.
- An onshore bank account has standard tax rules.
Rules and Regulation
- Offshore banking has minimum rules and regulation.
- Onshore banking has to follow standard rules and regulations of many authorities like tax department, central bank and government.