A merchant account is a type of bank account for businesses that allows accepting and processing credit and debiting card transactions. Merchant account is often required for various businesses, especially for online operations. This account is specifically used to identify the vendor as the owner of the purchase. Information about the owner and transactions is sent directly to the bank.

This bank account is issued by acquisition of a bank for a certain vendor under an agreement to settle payment card transactions. Sometimes, an independent sales organization, a member service provider or other payment processor takes place as the third party in the merchant agreement. After signing a merchant agreement, the vendor is contractually bound to obey the regulations of card associations, such as MasterCard or Visa.

Functions of merchant accounts
There are two main categories of merchant accounts that are usually chosen by different businesses depending on their type of operations. 'Swiped' is referred to transactions when a customer pays for his/her purchases in person and is required to swipe or insert credit or debit card. This kind of merchant account is mostly used in retail. 'Keyed' is referred to transactions when the credit or debit card information is entered through a virtual terminal, typically using internet. This kind of merchant account is mostly used by e-commerce merchants, but some merchants decide to use this method also during face to face transactions as it is less expensive.

Utilizing merchant account
Similarly, as you are able to deposit another person’s check into a checking account, a merchant account lets you accept a card payment from a client. Meanwhile, merchant account does not hold any money like checking or other deposit accounts. Instead, card payment goes through the merchant account via payment gateway and after the funds are cleared, they are deposited on a checking account. Commonly it takes up to 48 hours from the moment of the transaction for money to be deposited onto the vendor’s checking account. In addition, instead of receiving numerous deposits for each transaction, all payments from one business day are put together into one deposit payment called a “batch”.

Merchant account can also be explained as a line of credit account due to the fact that vendor gets paid before the actual funds are collected from the customer. This means that the vendor may be subjected to a personal credit check or requirement to sign a personal guaranty.

If you have more questions regarding merchant account – do not hesitate to contact our banking specialists to get a detailed consultation!

An online trading company is a trading company that operates primarily through the internet and its e-commerce tools. Similar to any regular retail company, online retailers specialize in buying goods from manufacturers and reselling them to consumers or other retailers. However, the online nature of this business makes it different and comes with specific benefits and limitations. Selling goods online offers enormous opportunities and advantages, since you can trade worldwide and save on organizational and administrative costs such as wages, office rent and others.

The main difference is that a 100% online trading company (with no physical stores whatsoever, just headquarters and warehousing facilities) requires virtual rather than physical infrastructure. An offline trading company needs offices, shops, warehouses and a logistics network that connects suppliers, offices and points of sale; An online trading company needs offices, storage space, powerful servers and websites, and a flexible logistics system that allows it to serve customers in many locations.

As you can see, online trading companies require less physical infrastructure, but they also need to be much more flexible to serve their customers. While a website is a useful addition for a regular trading company, for an online trading company it is an indispensable tool without which the company cannot function – hence the high demands on the website and host server's capabilities.

Functions of an online trading company
The main function of an online trading company is to purchase goods from a manufacturer and sell them on to retailers and consumers. A secondary, but nonetheless essential, task is to deliver the goods to customers, as usually online trading companies lack physical infrastructure, such as shops, outlets and other points of sale.

To buy and sell goods, an online trading company must set up a hub for transferring products from manufacturers to customers. In this case, that hub is a website. Just as a physical shop requires designers and marketing specialists to arrange and present products in the most advantageous way, a digital shop also requires specialists to guide customers through the possible buying options.

As for delivering goods, an online trading company can choose to either establish the delivery network itself, or outsource this task by entering into a contract with a logistics company. The online trading company then hands over its goods to the logistics company, which takes care of delivering the goods using its own network.

The development of telecommunications and economic globalization have made it possible for interested investors to set up companies all over the world. With proper research, financial investment and legal backing, business ventures can be safely incorporated in almost any country in the world. Building an international business used to be a complicated entrepreneurial venture, but today it is commonplace with the help of experienced legal and business advisors.

The advantages of founding a company abroad are as numerous as they are obvious. Many countries offer specific locational advantages, ranging from natural resources and well-established infrastructure to beneficial laws and regulations that encourage growth in a particular industry. Likewise, it can be difficult to start a business or an acquisition in your own country due to adverse situations: political or regulatory environment, lack of resources and more. In this situation, it makes sense to consider an overseas option that offers greater opportunities for growth, development, and success.

Company registration in Costa Rica
When starting a business in Costa Rica, an interested investor must conduct due diligence regarding legal procedures, international regulations, and sufficient investment for success. It is crucial to understand cultural, social and political factors that influence starting and growing one's business. Failure to do so may result in unintended consequences. Poorly researched and toneless international launches often end in disaster as time, money and energy is wasted due to poor planning.

Legal Documents
Every country in the world presents its own intricate challenges when it comes to starting, developing and maintaining a business. Owners, financiers and investors must make these commitments with the support of a knowledgeable and experienced legal team. Only someone with in-depth knowledge of local and international corporate law will be able to set up an overseas business while avoiding the pitfalls that plague many new businesses.

Additionally, smart business people can consider ways to invest in foreign companies without actually starting their own businesses. In these situations, it is still beneficial for the investor to partner with a knowledgeable global economics and litigation advisor. International investments create a truly diverse portfolio that offers growth opportunities that were unthinkable decades ago.

Potential investors, venture capitalists and entrepreneurs should consider the existing infrastructure in Costa Rica when planning to start a new business. While extensive infrastructure and systems can help make the process of starting a business a smooth one, it could also represent market saturation and reduced growth potential. On the other hand, a lack of infrastructure is often a major obstacle to growth; However, the lack of infrastructure points to a clear market opening for a creative and efficient new business.

Opening a bank account in Costa Rica
In connection with the formation of a company, it is necessary to open one or more bank accounts in Costa Rica. Confidus Solutions offers the ability to open a bank account in over twenty jurisdictions, making it easy for you to avoid challenging language barriers or bureaucratic hassles.

Virtual Office in Costa Rica
Since a registered address is a necessity for doing international business, Confidus Solutions enables foreign investors to set up a virtual office in Costa Rica. This address allows international entrepreneurs to accept mail, arrange for shipping and set up a registered bank account in their country of business.

Tax regulations
If you are researching starting a business in Costa Rica, consult with an attorney or consultant with extensive experience in the area you are considering. This advisor can help you with everything from laws and tax structures to local helpers. You need to consider every aspect from the local office to your highest organizational structure; Make sure you recruit the best possible mentors as you embark on this exciting but challenging process.