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A bank that is located outside the country of residence of its depositors is known as an offshore bank. Typically, most offshore account holders are non-residents of the bank's jurisdiction. The popularity of offshore banking is due to the various advantages it offers in comparison with national banking, such as greater privacy, easy access, little or no taxation and protection from political, local or financial instability. While the term originated in the Channel Islands, offshore from the United Kingdom, and while historically most offshore jurisdictions are located on islands, it is now used to refer to all banks offering the above-mentioned advantages, regardless of their location. For example, banks located in Switzerland, Luxembourg and Latvia are often referred to as offshore banks.

Benefits of having an offshore bank account
The main advantages of having an offshore account, and the reasons for offshore banking's growing popularity, are:

Convenience and flexibility — the process of opening an offshore bank account is significantly faster and more convenient than when dealing with national banks. Many companies now specialise in offering a full-service package for those looking to open a bank account in a specific offshore jurisdiction.
Multiple currencies — having several accounts for different currencies allows you to diversify risk associated with your home currency and profit from exchange rate fluctuations.
Little or no taxation — some offshore banks are located in jurisdictions called tax havens, where taxes on inheritance or income are levied at a lower rate or not at all.
Greater secrecy — an alternative term for a tax haven is secrecy jurisdiction, because most offshore banks offer higher levels of secrecy than are available in other countries. This is possible thanks to legal provisions in these jurisdictions prohibiting the disclosure of a client’s personal and account information to the authorities, except in the event of a criminal complaint.
Disadvantages of having an offshore bank