Offshore Bank Accounts Can Help You Manage Different Currencies

Bank accounts in offshore jurisdictions such as Belize are routinely offered in United States dollars (USD) and the local currency. Although it is natural for North American account holders who are new to the world of offshore banking to open an account in USD, they should not ignore the convenience and possibilities that local currency accounts offer. These benefits range from making local transactions easier, having greater access to the local networks of automated teller machines (ATM) with international debit cards, taking advantage of the currency exchange spread where applicable and being able to take part in the local private enterprise.

Among the many benefits of offshore bank accounts, the ability to manage accounts in different currencies presents a major advantage to the account holder. In Belize, offshore banking institutions typically offer demand deposit, term deposits and lifestyle accounts to international clients. These three accounts are available in U.S. dollars, which makes them very popular among North American clients.

Offshore Accounts in Belize Can Also be Opened Using the Local Currency

Many account holders who opt to relocate to Belize for retirement or expatriation purposes initially open accounts in U.S. dollars and later switch to Belize money. Some international investors open two accounts: One in U.S. dollars and the other in Belizean dollars. The idea is to stay flexible and to take advantage of the value of the local currency.

The Value of Belizean Currency

Unlike currencies such as the euro and the Japanese yen, the Belize dollar is not suitable for speculative transactions in the foreign currency exchange market, commonly known as forex. The Belize dollar (BZD) used to be known as the British Honduras dollar and was pegged to the value of the U.S. dollar at different times during the Central American nation’s economic history.

In 1978, the BZD became pegged to the U.S. dollar (USD) at the rate of two BZD per each USD. Belize has been able to maintain this currency exchange rate for the last 35 years, which speaks volumes about the economic stability of the nation.

 
Although a permanent adoption of the USD has been talked about in the past, the Central Bank of Belize has no plans to abandon its beloved national currency. Offshore bank account holders with international debit cards will find that many Belizean ATMs offer the option of withdrawing funds in either BZD or USD.

Doing Business with Belizean Currency

Since the BZD is pegged to the USD, tourists have no difficulties in making quick currency conversions. Businesses that cater to tourists often list their prices in one currency or the other, but this practice is not followed by other industries in Belize.

 
The local economy thrives on using the BZD, which adjusts to the fluctuations of inflation and the consumer price index (CPI). In 2012, the CPI in Belize was estimated at 2.8 percent, a fairly stable rate among Central American nations.

The Belizean Economy Strongly Supports Private Enterprise

Traditional industries such as agriculture and tourism are flexible in their use of the BZD or the USD. Real estate negotiations can be made in either BZD or USD, but in many cases, the BZD will be the currency of choice when it comes to taking the transaction to the closing table.

Belize also boasts a thriving corporate culture thanks to its International Business Companies (IBC) Act. Savvy investors who want to enter the lucrative world of international finance can take advantage of the corporate-friendly environment that Belize offers. Monetary transactions between IBCs can be settled with BZD or USD.

Most newcomers to offshore banking will initially choose to open their accounts in USD; they should not forget, however, about the strength of Belize money and the benefits it offers.

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