Bank of Montreal is blocking credit and debit crypto transactions: report | finder.com

Bank of Montreal is blocking credit and debit crypto transactions: report

Peter Terlato 29 March 2018 NEWS

An alleged company-wide staff email explains that the Canadian bank will cease all crypto-related activities.

Canada’s Bank of Montreal (BMO) has reportedly terminated digital currency merchant transactions for credit and debit customers, citing security reasons and the “volatile nature of cryptocurrencies” as justification.

In a recent post on Reddit, alleged BMO employee xxmatty87xx posted a screenshot of a supposed “company wide” email distributed by the bank’s wealth management product operations on March 28, 2018.

The email says that the block applies to transactions processed using BMO MasterCard credit cards (including small business credit cards), BMO debit card-upgraded (Debit MasterCard) and BMO debit cards (Interac).

Clients attempting any cryptocurrencies transactions using a BMO debit or credit MasterCard will be blocked, and will be presented with a screen message advising them that transaction cannot be completed. Clients who are signing up for cryptocurrency transactions for the first time will not be able to use their BMO MasterCard credit card or their BMO debit card-upgraded to register.

Alleged BMO staff email regarding cryptocurrency transactions

For Interac cryptocurrency transactions, BMO revealed that the bank will debit client accounts temporarily. When the finalized transaction is being sent from BMO to the merchant, the transaction will be blocked. Any debited funds will be automatically credited back to the client’s account within approximately 30 minutes.

There has been no statement from BMO regarding these changes and finder has reached out for comment.

BMO Nesbitt Burns Investment Advisors posted an introduction to bitcoin and other cryptocurrencies but warn that “as a team, we do not believe in the investment merits of cryptocurrencies at this point in time”.

Actions from other banks and financial institutions

Bank of America has expressed its concerns over the costs and risks associated with increased competition it faces from cryptocurrencies and the various businesses, exchanges and technologies that support them.

For many months global payments company Visa has expressed hesitation and skepticism regarding the new wave of digital currencies. The company’s chief financial officer recently took an even firmer stance that cryptocurrencies are volatile, speculative ventures, operating unregulated, in the grips of a financial bubble.

During an interview with the Financial Times in mid-March, Visa chief financial officer Vasant Prabhu lashed out against cryptocurrencies and at what he describes as investors who have “no clue” what they’re doing.

In early January, several prepaid cryptocurrency debit card providers had their services suspended by Visa.

That same month, during an interview at the National Retail Federation conference, Visa chief executive Alfred Kelly said the digital currency market was “still evolving” and that crypto payments aren’t credible payments.

“I don’t view it as a payment system player. In fact, we at Visa won’t process transactions that are cryptocurrency based. We will only process fiat currency-based transactions,” Kelly said.

In February, digital exchange Coinbase warned customers that, due to changes to the Merchant Category Code (MCC), credit card companies, such as Visa, can charge additional “cash advance” fees on crypto purchases.

The exchange also began preventing users from adding new credit cards for payments. The decision was made because Coinbase “cannot ensure customers will have a positive purchasing experience with a credit card”.

You can learn all about different exchanges, understand exactly how to buy and sell cryptocurrencies, calculate your taxes, discover digital wallets to hold assets and explore a list of all the alternative coins on the market.

Disclaimer: This information should not be interpreted as an endorsement of cryptocurrency or any specific provider, service or offering. It is not a recommendation to trade. Cryptocurrencies are speculative, complex and involve significant risks – they are highly volatile and sensitive to secondary activity. Performance is unpredictable and past performance is no guarantee of future performance. Consider your own circumstances, and obtain your own advice, before relying on this information. You should also verify the nature of any product or service (including its legal status and relevant regulatory requirements) and consult the relevant Regulators' websites before making any decision. Finder, or the author, may have holdings in the cryptocurrencies discussed.

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