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Infinite Banking For Business – How To Make It Work

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Infinite Banking Systems are becoming a trusted vehicle for growing individual wealth. But there are also many practical and beneficial ways to apply the Infinite Banking concept to businesses.

Understanding the Infinite Banking System
The concept is the same. With the Infinite Banking System, you put yourself in the position of being your own bank. This is done through a dividend-paying whole life insurance policy. As your cash values begin to grow you can begin to lend yourself money. If you need to repair something in your home, for example, you can borrow the money from yourself using the cash values within your policy.

You set the loan amount, the interest rate and the payment schedule. When you pay the loan back, you pay yourself with interest. So you are financing and making money on yourself, instead of paying that money and interest to a bank or other financial institution. Even better, your cash values will continue to earn interest and you may earn dividends on your entire pre-loan amount, as if you had never borrowed money.

Applying the Infinite Banking System to a Small Business
For a small business owner, the Infinite Banking System has a variety of potential benefits. Loans from your whole life insurance can be used to pay for legitimate business expenses, including:

-space rental
-new equipment
-office supplies
-bonuses
-corporate vehicles
-business travel

These are only a few ideas. The limits are infinite. And as with policies that serve individuals, the more you use the Infinite Banking System for business purposes, the more benefits you’ll receive. You can create a cash side account or gain, simply as a bi-product of your regular business transactions.

So why would you do this? Because the IRS allows businesses to write off legitimate business interest expense. By funding business expenses through your dividend-paying whole life insurance plan, you create an investment return for yourself and a tax write off for the business. It’s a win-win relationship. You, the individual, loan money to the business. The business pays back the loan amount plus interest to you, increasing your account cash values. The business gets to write-off the interest paid on the loan as a legitimate business expense.

While business owners can use their personal whole life policies to fund business expenses, policies can also be purchased by the company on key individuals, offering the same benefits of cash value liquidity, loan opportunities and tax advantages.

Making Infinite Banking Work for Larger Businesses
The concept of Infinite Banking has been an accepted practice in larger businesses and corporations for some time. These types of businesses obviously have a much greater need for capital – far bigger in scope and volume than an individual or small business does. But the Infinite Banking concept is carried out through Corporate Owned Life Insurance, and its counterpart, Bank Owned Life Insurance.

Corporate Owned Life Insurance
Corporate-owned life insurance, or COLI, is traditionally purchased to cover a business’s key executives. These policies are also known as “key person” insurance. A corporation will purchase a life insurance policy on a key employee to cover the potential financial cost of losing him or her to unexpected death. The insurance coverage is intended to cover the cost of recruiting and training new talent and to offset the possible loss of business due to the key employee’s absence. It also helps a company recoup the possible cost of benefit payouts to the deceased employee’s family.

COLI accounts can be used in the same way as individual whole life policies. Corporations use their participating whole life insurance policies to build cash values. Just like with individual policies, contributions and gains accumulate tax-free, and loans can be made as needed for any business need.

Bank Owned Life Insurance
The financial industry has its own version of this type of insurance. Bank-owned life insurance, or BOLI, has been traditionally purchased by financial institutions for their key executives. And although its been an accepted practice for many years, its popularity is increasing. In 2008, for example, banks purchased $126.1 billion of whole life insurance.

Using COLI and BOLI as Infinite Banking Concepts
Because these corporate life insurance policies are usually for much larger amounts than individual policies, the potential for reinvestment and explosive cash value growth are much greater. Although the policies cover individuals, they are purchased to protect corporations and banks for their potential losses, boost Tier 1 capital and provide benefits that might not otherwise be affordable. So it is the corporation or bank that is the policyholder, and these purchasing institutions can use these policies much like an individual uses a participating whole life policy to fund the Infinite Banking System. Corporations can use the cash values within their policies to fund legitimate business expenses such as:

-Large equipment or machinery
-Employee retirement plan
-Employee Health & Wellness Plan
-Corporate Vehicles
-Your lease/building space
-Corporate Housing
-Travel Expenses
-Business Loans
-Adding Fringe Benefits to Attract Key Personnel
-Business Acquisitions & Merger

Corporations and banks have long known the financial benefits of infinite banking through their COLI and BOLI policies. By using a dividend-paying life insurance policy as a platform for the Infinite Banking System, now smaller companies can enjoy these same benefits.

Understanding Banking Better @ Ssbm

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Symbiosis School of Banking Management is one of the premier institutes located in Pune that is able to offer an in-depth analysis of the BFSI sector with its MBA in Banking Management program. Contrary to the regular Symbiosis MBA in Finance, SSBM focuses more on the concepts relevant to both banking and finance sector. The curriculum at SSBM is a fine balance of academics and extra-curricular activities that is able to give students the much needed grooming or training to become capable managers of the banking sector. In fact, Symbiosis Banking Management courses is one of the few programs in the country that has received an extremely positive feedback from the industry and in-spite of its relatively recent establishment, SSBM has fast grown to become a popular PG destination amongst students.
Organizing regular industry interactions so as to make the students aware of the latest developments along with inviting experts to share their opinions and experiences is one of the most religiously followed rules in the SSBM curriculum. In line with this tradition, SSBM will be organizing a special workshop on Mergers and Acquisitions in the second week of February 2013. The workshop will be conducted by Dr. Nilanjan Sen (Associate Dean, Nanyang Executive Education and Associate Professor, Banking and Finance, Nanyang Business School). With Mergers and Acquisitions happening on a daily basis, it is very important for the MBA in Banking Management students to do an in-depth analysis through such workshops.
The Symbiosis Banking Management program is a comprehensive approach towards understanding the BFSI sector. This workshop will help the students broaden their perspective and understand the functioning of the BFSI sector with regards to the latest developments in the industry. It is these distinctive features that put up SSBMs MBA in banking management program high on the preference list of students looking for options in their PG programs. In fact; hosting workshops, encouraging students to develop a proactive approach and even and learning through practical training are all an integral part of the Symbiosis Banking Management program in Pune.
The rigorous study routine is not the only part highlighted in the Symbiosis Banking Management program; SSBM balances academics with an equal dose of extra-curricular activities through its regularly organized events, creative clubs, etc where students are given an excellent platform to nurture their innate talents. This year the admissions 2013-2015 have yet again received an overwhelming response as millions of students aspiring to enter SSBM, have put forth their registrations.
This is just one of the many events organized by SSBM. Just recently, SSBM also organized a knowledge enhancing conclave with Mint-one of the leading newspapers of the country. Even during the coming year, SSBM has a series of interesting events lined up to create an interacting learning atmosphere for the students.
Currently the institute is looking forward to welcoming the new batch as they go ahead with the next round of group discussion and interview sessions. Applicants to SSBM can follow us onhttp://www.pagalguy.com/forums/xat-snap-iift-and-others/admission-2013-2015-at-ssbm-t-87968/p-3609268/r-4253981 for latest updates with regards to the Admissions 2013-2015.
We will be happy to assist you!

Add Breeze Banking To Your Life

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The Breeze from Stan Chart (also known as the Standard Chartered Bank) has created a new generation online banking platform that is making waves all over Singapore where it was developed!

Available in both Singapore and Malaysia the Standard Chartered Breeze will be available in Hong Kong and India very soon. From there it will extend its reach to the rest of the world. Prepare for the Breeze experience to breeze its way into your town or city and into your very life!

If you have always found it boring, frustrating, stressful, annoying or inconvenient to do your banking then you are ready for the Breeze experience to come into your life! Breeze is available to customers of the Standard Chartered Bank as an internet application or if you prefer, as an iPhone app. Do no fret over the details concerning the Breeze as it will be available as an iPad app as of September 2010 which is not far away at all!

Keep in mind that the reason most people use banking services offered online and through mobile devices is convenience. For instance, business owners or executives who travel can gain access to business accounts anytime day or night and from any country or individual accountholders could handle a bank transaction while vacation on a tropical island. This means that every feature associated with the Standard Chartered Breeze platform has been carefully designed to meet the customer’s wish.

Breeze offers you the opportunity to customise the icons to make them suit your preferences. It comes with a handy wish list functions to help you plan for the things you want most to save for. The wish list also offers a rainy day feature that prepares you financially for emergencies that could crop up. It is also in plain language and has an intuitive interface that is as customer friendly as it could be. For example, it has a See, Move and Manage Your Money section that makes keeping track of your money and managing it the easiest thing in the world.

If you have just started banking online recently then the introduction of Breeze will improve your banking experience 100 percent. In fact once you start using Breeze you will never want to go back to banking any other way or with any other financial institution.

It cannot be emphasized enough that Breeze was created with the customers and users in mind. It takes your greatest needs in terms of banking and makes them a reality. You will not have to endure any more frustration when you use Breeze by the Standard Chartered Bank.

Breeze has an intuitive user friendly and user savvy interface as well as providing you with the unique ability to customise the icons as you see fit. What other banking application can say as much? Breeze is the bomb and it will be on the market very soon!

Ultimate Info On Internet Banking

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More people are conducting business with their bank online today. Some men and women still have fear of having information and facts stolen or other acts of fraud carried out on them if they do this. There’s some info to know if a person is beginning to do internet banking.

Banking on the net allows banks or credit unions, either virtual or retail, to service their customer’s financial transactions by means of a secure web site that they operate. A few of the institutions are entirely on the web and there are no buildings for a customer to go to whilst others still operate normal branch offices.

Once an individual sets up an account with their financial institution and finds that it offers web banking they can access lots of typical account transactions on line. These transactions are the same ones available by going into a branch office. They contain account or wire transfers, paying a bill, opening new accounts, acquiring bank statements, and many other items.

Having the capacity to pay bills on the net by means of the banks web page has streamlined the bill paying procedure. Online bills might be set to virtually any frequency and set to a predetermined amount for a users bills. You’ll find some which will link to the internet site where the charge is originating and generates the exact quantity and date due for the bill so the user doesn’t have to do anything other than grant access to the account.

By having access to the on the web account a customer can very easily check the balance on their account as well. This helps to verify funds out there prior to paying a bill or making a buy. It also helps simplify the procedure of checking for fraudulent activity on the account and permits for quicker response to this type of fraud.

Lots of on the internet accounts will also give software to access several accounts in one location. This saves time for anyone that has multiple accounts and makes it possible for for a quick overview of all the accounts an individual has offered. Having this capability makes it significantly less difficult to monitor multiple accounts.

Some institutions will also have spending budget software built into their web sites. So when a customer logs into their account the transactions that they’ve made will show in a category. Numerous websites permit for a user to create their own categories and to move transactions into the category they really feel it fits very best in.

Account security is some thing that quite a few buyers worry about. Some of the widespread methods that others attempt to get banking data from an individual is by way of phishing, pharming, and trojan horses. Financial institutions fight these attacks off by updating their digital certificates to keep their web sites secure. A user can help their own security by ensuring that they’ve virus software which will scan their system and by utilizing caution when downloading software or opening email attachments.

Web banking has helped quite a few consumers by offering bill pay and straightforward to access account statement services. It’s necessary to make use of caution with on the internet banking and normally ensure virus scan software is up to date.

Offshore Online Banking Guide – Critical Information You Must Know

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There are several legal and regulatory compliance implications with offshore banking that I’d like to cover in this article. However, please don’t construe information on this site as legal guidance. I am providing this information for free based on my own experiences. Please consult your professional attorney or CPA (accountant) before you get involved with offshore internet banking.

What is an Offshore Bank

To be over simplistic, an offshore bank is a financial institution outside the shores of your country. If you are in Australia, a bank in the United States is an offshore bank to you. If you are in the United States, a bank in Singapore is an offshore bank to you. Therefore, the idea of offshore banking is relative.

A business or an individual, in this case you, may select an offshore bank account in a jurisdiction that is typically favorable in terms of taxes (often referred to as a tax haven by media), as well as in terms of legalities. In addition to choosing a jurisdiction with no to little income tax, for many, privacy and “secrecy” of banking activities are two of the bigger key considerations.

It goes without saying that access to your funds is important, as well as protection from corruption and stability in terms of certainty.

List of Common Offshore Online Banking Services

This is a brief list of services offered by offshore banks. This list is by no means a full comprehensive list of an offshore bank’s offerings, but rather a list of some of the most common offshore online banking services that businesses and individuals are offered:

Remote Deposits of funds
Direct Deposits of funds
ACH / Wire Transfers / EFT – Electronic Fund Transfers
Consumer and Commercial Lending
All Basic Credit Activities
Access to Capital – Offshore Debit Cards
Forex – Currency Exchange
Wealth Management
Offshore Trading Account
Offshore Brokerage Account
Administrative Services
Trustee Services

Note: Offshore banks typically tend to focus on either consumer or commercial banking. Within consumer, banks differentiate between retail consumer (the average individual) or private banking (meant for high net worth individuals).

Because each concentration involves a different cost structure from the bank’s perspective, when selecting an offshore bank for yourself, be clear on what type of consumer you are and what offshore online banking services you need. Gaining this clarity will ensure you are not disappointed in your choice.

List of Common Offshore Banks

No doubt the two most common names in offshore online banking are Switzerland and Cayman Islands. Just pick up any business journal or pop in a business based Hollywood flick. There is likely a mention of a Swiss bank account somewhere.

This is because as of at least 2012, these two jurisdictions held the most number of total deposits amongst all offshore online banks. Some other jurisdictions that offer offshore online banking are the following:

Singapore
Malaysia
Panama
Cook Islands
Dominica
Saint Kitts and Nevis
Antigua
Malaysia
Anguilla
New Zealand
Luxembourg
Bahamas
Barbados
Bermuda
British Virgin Islands
Cyprus
Cook Islands
Channel Islands
Monaco
Mauritius
Hong Kong
Malta
Macau
Regulating Offshore Online Banking

With complexity comes increasing regulation. The regulation around offshore online banking activities has steadily increased over the years, but according to many of its supporters it is still not enough. This means much more is in the pipelines. Regulation has particularly increased significantly after the significant events of September 11, 2011.

Regulatory guidance is issued and monitored by global bodies such as the International Monetary Fund or the IMF, who require financial institutions worldwide to maintain a certain level of operating or performance standard, specifically in terms of capital adequacy and liquidity. These key performance indicators are to be reported by banks on a quarterly basis to its designated regulator (such as the Fed or the FDIC in the United States).

The list of regulations is endless and quite comprehensive to say the least. Some notables are the Anti Money Laundering (AML) regulation and the Bank Secrecy Act (BSA). These acts require banks and financial institutions to immediately report suspicious activity resembling money laundering to local government authorities despite stepping out of the BSA jurisdiction.

Another example is the information sharing requirements between a certain group of countries with regards to capital flow and taxation which was initiated by members of the European Union. On the other side of the pond, the taxing body of the United States, the Internal Revenue Service (IRS) requires financial institutions to report to it names of businesses and individuals who benefited from interest income resulting from deposits in US based institutions.

The most notable in my opinion of recently enacted regulations is the US Patriot Act, which permits the US Government to seize all assets of a financial institution if it suspects that the institution holds assets that belong to a potential criminal. Several other countries have since followed suit.

I personally feel these regulations strengthen the global banking infrastructure. But then again I am just one person. There are others who feel in all sorts of ways about offshore online banking.

Interesting Fact: Did you know that just until the 1990s, individuals were allowed to create their very own offshore banks. This practice was stopped and now only large institutions are allowed to do so.

Connotations and Implications of Offshore Online Banking

It is not illegal to conduct offshore online banking, but such activities tend to carry with them a certain set of connotations and legal implications that you must be aware of and comply with. There can be severe fines, penalties and legal repercussions if you fail to comply with the legal and regulatory requirements.

Why you must be thinking? Because offshore banking historically has been used and abused by those who intended to evade taxes, as well as those that used funds for illegal causes. For example, organized crime networks heavily use offshore online banking to launder money.

But like I said, conducting offshore online banking isn’t an illegal activity. All persons conducting offshore online banking are required by most countries (depending on their residency) to disclose the activities and the outcomes, such as interest income for example.

Specifically in the United States for example, a US resident’s income is taxed on a global basis. This means that even interest earned overseas is subject to taxation by US authorities. Now although financial institutions are not required to disclose this information to countries of interest due the bank secrecy guidelines, individuals are required to disclose this information.

Similarly, one can legally avoid taxes in certain situations. For example, a resident of Country X living and working in the United Arab Emirates (UAE) may not have to pay taxes if Country X does not tax the individual’s global income.

Because there is no taxation on income earned in many Arab nations, interest income earned from deposits in a UAE bank account is not subject to tax. Further, the income is also not taxed in Country X. This is a common reason why so many affluent folks change residency and citizenship status, one that resonates most with their financial goals and objectives.

It’s a very interesting dynamic and there is a ton of opportunity for strategizing as you can imagine.

Dollar Concentration in Offshore Online Banking

Although offshore online banking is not a subject delved into by the average individual, the numbers involved (concentration of wealth and financial activity) are quite significant. You may find a lot of these simply fascinating.

For example, specialized banking economists and analysts indicate that half of the global capital (money) flows through one of the many offshore banks out there. The so called Tax Havens (think Switzerland) have over a quarter of the global wealth (think high net worth individuals and big companies). These Havens also hold over 30% of profits generated by companies based in the United States.

And that’s not it. Over 6 trillion US dollars owned by high net worth individuals are also reported to be held in offshore bank accounts in one shape or another.

Illegal Monies in Offshore Bank Accounts

Opportunists have identified weaknesses in the offshore banking system and thus have taken advantage of the systems to launder monies generated through illegal means and used for illegal purposes. According to the IMF, this amount is as large as 1.5 trillion US dollars on an annual basis. To put things in perspective for you, this is roughly 5% of the world’s total Gross Domestic Product (GDP).

In addition to illegal monies, there are also monies that have evaded taxation as well as monies that were generated through fraud, graft and corruption. All in all, the amounts are super significant. And as I stated above, the two jurisdictions with the biggest concentration of these amounts are the Cayman Islands and Switzerland (as of 2012).

Offshore Internet Banking for Corporations of All Sizes

I have already stated this earlier, but offshore online banking is not only for large companies, but companies of all sizes as well as individuals. There are a certain set of requirements that any institution, an individual or a company have to meet in order to open and maintain an offshore bank account.

In fact, it is easier for individuals to open and maintain an offshore bank account before companies are required to complete additional forms in a specific manner when establishing an offshore internet bank account.

Corporations typically engage in offshore online banking when they contemplate one or any mix of the following purposes.

Cost containment (bank fees and charges)
Paying and receiving payments from vendors and customers in local jurisdictions
Asset protection strategies
International acquisitions and investments
Compensating local employees in an offshore jurisdiction
Political reasons – Stability and predictability
Establishing a local business presence
Again, this is not a comprehensive list of why companies engage in offshore online banking. There are several other reasons why a company may decide to establish an offshore bank account. The only true way to find out the best offshore bank for you, and whether your objectives will be met through offshore internet banking is by speaking to a professional who can walk you through the entire process.

Concluding Thoughts on Offshore Internet Banking

I gave you a ton of information to read and digest in this article. As you have read, offshore internet banking is used by several different constituencies for several different purposes with several different intentions.

There are some significant advantages that can be derived from opening an offshore bank account such as entering new global markets and some serious offshore tax planning. I obviously recommend opening an offshore bank account for the right reasons, with full compliance with laws and regulations. For those contemplating abusing the system, understand that bank secrecy is a weakening concept, and one that will continue to weaken over the years.

Countries are increasingly sharing information, some voluntarily and some while succumbing to pressure by more powerful nations such as the United States.