Virtual corporate accounts function as sub-accounts through which money is transferred to and from a Master Account –a physical bank account. A virtual account allows you to manage your transactions online, enabling you to conduct your business from anywhere and at any time. This, however, is merely one amongst many advantages of having a virtual bank account; opening a virtual bank account with IBAN can further improve your business’ oversight and simplify your financial management.
What is a virtual business bank account?
A virtual business account system is essentially a self- designed network of accounts, structured in a manner which complies with a business’ financial necessities and requirements; it is a comprehensive and cost-effective manner to manage, allocate and integrate a company’s funds. The system comprises a network of virtual accounts, also known as “shadow accounts,” to which clients transfer money. The payments made by clients are then automatically transferred to a Master Account. Each client, business unit or other incoming/outgoing transaction can receive an allocation of a specific virtual account number. This enables you to efficiently monitor your funds – knowing the exact source of your incomes, while simultaneously grouping your resources and incomes in an orderly manner.
What is a virtual IBAN account?
With a virtual bank account, all transactions take place on the Master Account. Unlike a virtual account, that has no IBAN, A virtual IBAN account is a bank-issued dummy account number which allows international rerouting of funds, from a virtual IBAN account, or several accounts, to a real IBAN account – underlying a physical account. With a virtual IBAN account, businesses can allocate several IBAN account numbers to various suppliers and/or clients. All payments are then transferred to the physical, real IBAN account. This enables businesses to centralize their transaction management and identify the source of payment, subsequently simplifying the reconciliation process. Notably, in terms of the client’s perspective, the virtual IBAN account, to which payments are made, resembles a real IBAN account.
The Benefits of Having a Virtual company Bank Account
A business Bank Account helps you optimize your working capital while abating your supervisory burden. Occupying no actual space, virtual banks are able to save in labor and overhead costs, thus offering low-cost banking services, higher interest rates and lower service fee. Having a virtual account is also highly convenient as you can conduct your businesses at a time and place of your choosing. Since documentation of ingoing and outgoing transactions is clustered, a virtual account facilitates a greater sense of control when managing your account, allowing you to conduct your businesses more efficiently and conveniently.
Virtual business bank accounts provide you with the following:
-Low administrative costs. Notably, since there are no “free meals” when conducting businesses, if offered a “free virtual account,” make sure to inquisite as to any hidden charges, fees and costs.
– Simple flow monitoring.
– Improved cash flow.
– Improved account reconciliation process.
– Ability to change your clients’/ suppliers’ assigned account numbers at any given time.
Opening a Virtual Bank Account
The process of opening a virtual bank account is both straightforward and rapid; normally, it is as simple as filling out an online document or making a deposit. You ought to begin by allocating your account with a clear purpose, for example, designating a legal entity or even a business unit. This procedure is carried out by assigning a unique identification number to each of your virtual accounts, therefore differentiating it from other existing accounts, within the Master Account. Having a European virtual bank account which contains an IBAN number allows you to conglomerate other accounts into one central account.
For more information visit the Fintech Zone YouTube Channel .Michael Dewan is head of PR at GBO International Financial Services LTD . GBO is becoming a world leader in providing corporate services for international companies. These services include assistance with: incorporation of companies, opening business bank accounts, licensing, payment solutions, nominee services and more. GBO offers the most innovative A to Z financial solutions for high-tech companies, eCommerce, and more.