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Panama Financial Services Company

A Panama Financial Services Company is a special type of Panama Corporation (IBC) that has been approved for a special license by the Panamanian Ministry of Commerce. Known as an "Aviso" (Operational Status), it grants these companies with the ability to transact certain financial operations that do not require a more stringent regulated license.

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Table of Contents:

A Panama Financial Company is a non-bank financial entity that can be used for many purposes including:

  • payment processing of any third-party payments
  • foreign currency trading,
  • Bitcoin payment receiving
  • taking debit and credit cards, or
  • trading in precious metals. 
  • Act as an intermediary for payment processing such as a correspondent account 

Benefits of a Panama Financial Company

  • Licensed Panama Corporations are popular for those looking to set up offshore financial services companies whether that handles third-party funds,  providing electronic payments services, or whether its other forms of payment processing.
  • The most efficient way to handle third party funds is through a Panama Service Company as it exists in an unregulated market especially as more and more banks are requiring companies to show some form of license to handle third party funds.
  • Panama financial services companies work effectively with other foreign structures – perhaps as a way to outsource services offshore for tax purposes and/or to provide additional services to clients of a company in another jurisdiction.

 

  
 
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Advantages 

  • Open bank accounts and accept client funds and transfers
  • Manage and transfer funds on behalf of clients of a bank licensed in a separate jurisdiction
  • Open currency, FX and BitCoin accounts
  • Become and third party payment intermediary
  • Currency / FX and Bitcoin accounts

Details

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Virtual Office

In Panama, it is required to have a place of business other than the company's legally registered office address. This means, at a minimum, having a virtual office with a shared receptionist, a telephone in your company name with fax and mail/fax/phone forwarding service.

Offshore Protection Virtual Office service provides you with an official place of business in Panama that the Ministry inspector can visit. 

Taxes

Having a legitimate place of business also means that the local 'Municipio' (city council) will expect to collect its monthly tax as it does from all local businesses. Currently, the monthly tax fee is US$20, subject to their assessment. Other than this the Panama Financial Services Company will still be considered 'non-resident' for tax purposes.

This is the only annual compliance requirement to maintain this type of company in good standing, along with the normal annual company renewal payment of government franchise tax and resident agent fees.

   

 
 
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Restrictions

Bear in mind, these special licenses DO NOT allow the Panama Corporation to engage activities such as: 

  • Securities broker-dealer activities including investment funds, managed trading etc.
  • Savings and Loan (financiera)
  • Fiduciary (trust company) services
  • Any banking services including debit cards which in Panama only a bank can provide
  • Cash money transmittal services or cambios (e.g. bureau de change)

These services are regulated differently by the Panamanian government and all require a more stringent type of license, with minimum paid-in capitalization and public audit requirements.

Also required in Panama are local directors and a local office with staff, although some of these licences (with the exception of banking) are available in other jurisdictions without a physical presence.

In Panama payment processing and e-currency services can be offered with a full regulated licence which requires USD 50,000 in paid in capital to be deposited with the National Bank along with a local office with two personnel.  This entry-level non-regulated licence can be upgraded at any time into a full supervised and regulated one.

Other Details

The Panama special license, along with the Panama Corporation is readily available within about two to three weeks. Nominee Director services are also available based upon requirements.  A certified English translation with apostille is also included alongside the Spanish original.

   

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*Note for U.S. citizens: US citizens are limited in their tax reduction possibilities due to FATCA and CFC laws. Opening an offshore company can increase privacy and asset protection, but you can not eliminate your taxes without giving up your citizenship. If you are a US citizen you are obligated to pay taxes on all worldwide income. 

 

 


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