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Ideas/Section-8
CURRENT ACCOUNT
A Current Account is the most common type of foreign bank account.
It is the
most popular one because it gives you the most flexibility in managing
your
money. It allows you to withdraw all or part of your account balance
at any
time.
Most Current Accounts pay interest on your balance. You can maintain
your
Current Accounts in U.S. Dollars, or you can have your money invested
in any
number of foreign currencies. Some offshore banks offer "multi-currency"
privileges. You can deposit monies in one type of currency and withdraw
funds in another currency. Most current accounts also provide you
with
checking privileges, and with the proliferation of ATMs, some offshore
banks
will even provide you with an electronic banking card. The most
popular
electronic banking card being issued by ofshore banks is the "Eurocard".
DEPOSIT ACCOUNT
A deposit account is similar to a time-deposit or CD in the US.
It is an
interest-earning savings account that you open with a bank in a
foreign
country.
The rates of interest offered to Deposit Accounts vary according
to the
currency of the account and the length of time for which the money
is
deposited. The longer the money is deposited, the higher the interest
rate.
Aside from the legth of the deposit, the size of the deposit also
helps
determine the interest rate. Most deposit accounts require a minimum
deposit
of $2,500 or more.
Deposit accounts are not as liquid as current
accounts, and you may be
prevented from withdrawing your money for a period of time. As with
a
current account, you will receive a semiannual statement of the
account's
activity.
NUMBERED ACCOUNT
Also knows as the "invisible account", this type of service
is popular in
Switzerland, Belgium, Luxembourg, and Mexico, all of which provide
Numbered
Accounts. The basic difference with conventional bank accounts is
that a
numbered account is an account identified by a number, rather than
by the
name of the account holder. As a result, it provides a certain amount
of
protection and privacy, especially if bank records or passbooks
are lost or
stolen. It is important to remember what a numbered account is not:
a
numbered account doesn't mean that no one at the bank knows who
the real
account holder is. It just means that clerks at the bank who handle
data
entry or clerical transactions will not know your identity.
SAFEKEEPING ACCOUNT
This service is just like a safety deposit box account in any bank.
You get
this type of account to deposit such things as bonds, stocks, and
other valuables.
But it also has an added feature. If you
have coupons that you redeem, the
bank will do it for you. They will clip the coupons, redeem the
bonds, and do
whatever needs to be done with the valuables entrusted to them.
COMMODITIES ACCOUNT
Some of the larger foreign banks have geared themselves up to trade
in
commodities on your behalf. These banks are set up to give you the
latest
commodities prices, and to let you buy and sell commodities over
the phone.
Compared to US banks that still cannot enter the commodoties trade
market,
this is proof of how offshore banks are becoming more and more competitive.
