DIFFERNTS BETWEEN OFFSHORE VS COMMERCIAL BANK

Offshore banks

Commercial banks

An offshore bank is located

A commercial bank is a

outside

financial institution that is

the

country

of

resident of depositors
Which is mostly in a low

Meaning

authorized by law to receive

money from businesses and

tax or no tax area that

individuals and lend money to

provided financial and legal

them. Commercial banks are

advantage to their deposits.

open to the public and serve

individuals, institutions, and
businesses.

Offshore banking provides

Commercial banks Provides

Account open for foreigners Account open Account open for resident in
only

India and Non Resident in

India.

Offshore banking dealing

with foreign currency only.

Commercial banks dealing

Dealing
currency

RBI provides Tax free

benefits for offshore bank

with both Indian currency and

foreign currency.
RBI provides tax deducted

Tax Benefits

from commercial bank for

Income Tax Act,1956

NOSTRO, VOSTRO,

Savings Accounts, Current

LORO, are this type of

Accounts, Recurring

accounts provided by
offshore bank
The Interest rate in offshore
bank is higher as compared

Type of
account

Accounts, fixed deposits

Accounts, are provide for
commercial bank
The Interest rate in

Interest rates commercial bank is lessor.

to commercial bank
Offshore banks are set-up in
India are high cost of
maintenance

Commercial bank are set- up

Maintenance in India are low cost of

s cost
maintenance