Tour Operator 2
(Financial Innovation)
Mandate
Structure a competitive priced credit card processing and banking facility for a leading European tour operator at a bank with a strong balance sheet. Establish a tax efficient operating platform.
Background
The tour operator received a substantial amount of credit card based deposits and was paying high fees and large deposits. It sought to increase margins and cash flow by establishing a better card processing and banking facility for amounts blocked from processed volume.
IIG has excellent relationships in European jurisdiction with an optimal tax structure, and proposed that credit card processing be moved to a leading local bank, which could offer competitive rates and better banking terms.
Solution
IIG mapped the requisite steps to establish a commercial account and a credit card processing facility for our client at the leading local bank with several billion Euros on its balance sheet and that does not accept business from any foreign companies or entities that it does not know. Due to the strict regulatory environment
IIG had to structure a commercial gateway agreement for credit card processing with the bank, which is the only agreement of its kind in the jurisdiction.
The lengthy process entailed establishing a properly licensed limited company with a corresponding profile and infrastructure in Andorra.
IIG engaged a law firm that it works closely with at favourable terms to traverse the complicated process which
IIG supervised. Finally, after an initial period of operation, an analysis was conducted to establish an efficient method for blocking and releasing a percentage of the volume processed corresponding with the analysis results rather than using a high standard rate.
Our client today enjoys a substantial savings on its credit card processing rate, has better cash flow and has reduced its taxation through a fully compliant operating structure.
Remuneration
IIG took a monthly consulting fee capped early in process and a success fee based on a percentage of the savings earned by our client.
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