A European Merchant has to apply for a Merchant Account in the European Region of Visa and MasterCard, but when will a merchant be considered any nationality and is it the beneficial owner of a company or the company that is in questions here?
In fact it is the applicant which the *Acquiring Bank will look at, if the merchant is applying as a business then it doesn’t matter where the beneficial owner is located, however, there are certain requirements in the different countries that a company must comply to, such as to have a local registered secretary.
It is not in any way allowed for a European Company for instant incorporated in Germany, to become a Merchant Account in for instant the USA, this would be against the Visa and MasterCard cross boarder regulations; the Acquiring banks are also aware of this and will decline the application.
For individuals or sole proprietors the same applies no exception.
We would have posted some official links to Visa and MasterCard about this, but at the moment we searched we wasn’t able to find the relevant information, if we find it we will add it to this article.
Where do you get this information from?
Since as you can read from many of our blogs, we have been in this business for more than 8 years now, then we have a bunch of contracts, agreements and Visa / MasterCard regulations on hand, but are limited to several NDA’s which prevent us to post any parts or the entire document here. However, you can proof check the above and below very simple try to apply for a merchant account where you not belong to, you will be declined if the Payment Service Provider / ISO / MSP or Acquiring bank you look at are legit.
I found a company which state they can accept merchants worldwide with 1 bank, how comes?
There are 2 options here:
- 1) The Payment Service Provider will ask you to incorporate in the country where the bank is located, this requires additional costs but is of course a legit solution on this and very common.
- 2) They try to fool you into a solution which isn’t legit, this is sadly often the case, so many fly by night companies are popping up with cheap web sites (often just a 6 page site) and which just there to make the quick buck by scamming people, often they are not themselves aware of what they are doing it is simply a lack of knowledge, they don’t know better.
If you find a company which is like described in point 2, it might be true they will get you started, but be sure this solution will not last and the risk you will lose all your moneys is 90%, our advice, stay away from this, the last 10 years have shown it incident after incident, it won’t work.
Visa and MasterCard have divided the world in 6 regions and a merchant which has its business incorporated in a country which belongs to a certain region need to apply for a merchant account in the region it belongs too, it is now allowed to have a merchant account in another region than where the company is registered.
Source: http://www.mastercard.com/sitemap.html
We hope to have clarified this issue and that this post can be distrubuted to as many as possible for all of us to conduct an honest business.
On behalf of CCLOGIC.COM we whish you all the best.
