Online financial news platform, Finance Magnates, has reported that credit providers Visa and MasterCard are categorizing foreign exchange, binary, cryptocurrencies, and ICOs as “High-Risk Securities Merchants”. The changes in classification will be immediate for MasterCard, and before the end of the year for Visa.
This change affects both users and merchants in the industry. Some merchant vendors have already informed their user base that credit card deposits are no longer an option. With the change in categorization to high-risk, chargebacks could take up to 540 days after the transaction date to be executed.
The Finance Magnate article is cited:
“Clients of brokers who are operating from loosely regulated jurisdictions and unregulated companies are facing a tough time. They either have to become entirely reliant on bank wires and alternative payment providers or await a solution to the problem on the part of their payment processors. Until such a solution becomes a reality, payment processors are set to suspend services to some brokers and cryptocurrency exchanges.”
With brokerages providing services in the EU feeling pressure due to the continually changing framework over cryptocurrencies, this new implementation from VISA and MasterCard is now going to challenge unregulated brokers. Currently, payment providers are looking for work around to this new development.