2012-8-22 techweekeurope.co.uk MasterCard Denies Plans For BitCoin Credit Card

[cbeast]

http://www.techweekeurope.co.uk/news/no-bitcoin-credit-card-planned-90058

“MasterCard has no relationship with BitInstant. There are issuers who allow the conversion of Bitcoins to US dollars and other currencies, delivered on prepaid cards. However, we’re not aware of this particular programme from BitInstant.”

[matonis]

This still needs to be sorted out because Mastercard wouldn't necessarily have knowledge of partner bank's affiliate negotiations.

[Technomage]

This is interesting. However, I assumed BitInstant doesn't have anything to do with Mastercard directly, anyway. The bank that they are working with are doing that. Also the article didn't say Mastercard has anything against this, just that they don't know anything about it yet.

[Yankee (BitInstant)]

This is interesting. However, I assumed BitInstant doesn't have anything to do with Mastercard directly, anyway. The bank that they are working with are doing that. Also the article didn't say Mastercard has anything against this, just that they don't know anything about it yet.

+1

[cbeast]

Yeah, in the original irc chat, Charlie said he would deny this announcement and I have seen no formal press release yet. It's probably just a matter of paper shuffling at this point. MasterCard has not denied any future dealings with Bitcoin, so I'm not worried about it.

[mem]

Im often overly optimistic but reading between the lines it sounds like mastercard is familiar with and open to discussions on bitcoin.

[Piper67]

Im often overly optimistic but reading between the lines it sounds like mastercard is familiar with and open to discussions on bitcoin.

+1, the worrying thing is the FUD potential of this though.

Hmmm... the media is weird sometimes, though. If this spreads like FUD, and then it turns out we all do get a Bitinstant Mastercard, it would be very positive in the end.

[Technomage]

Hmmm... the media is weird sometimes, though. If this spreads like FUD, and then it turns out we all do get a Bitinstant Mastercard, it would be very positive in the end.

+1

[matonis]

Unfortunately, after Slashdot, it spread to the Verge http://www.theverge.com/2012/8/22/3260059/mastercard-denies-bitcoin-debit-card-rumors

[dissipate]

This still needs to be sorted out because Mastercard wouldn't necessarily have knowledge of partner bank's affiliate negotiations.

That is probably true, but the problem is that now that they know about it, they could revoke that bank's authorization to issue debit cards. The fact that MasterCard is coming out and saying they don't have knowledge of this does not bode well for the product launch.

[matonis]

This still needs to be sorted out because Mastercard wouldn't necessarily have knowledge of partner bank's affiliate negotiations.

That is probably true, but the problem is that now that they know about it, they could revoke that bank's authorization to issue debit cards. The fact that MasterCard is coming out and saying they don't have knowledge of this does not bode well for the product launch.

That was my initial thought too, because something that was relatively innocuous is now on CNN, etc. However, in reality, the affiliate card programs generate transaction/fee volume for MC; they don't care if it's a Planned Parenthood card or an ACLU card or an NRA card. I doubt that this has put bitcoin on any 'special radar' (it's no different than selling bitcoin on your own and putting the value on your Wal*Mart debit card.)

I believe that the BitInstant card will receive approval. The thought that Mastercard is intimidated by bitcoin is funny, because they could co-opt BTC momentum at any time by just adding it to the list of 158 other currencies that they authorize and clear in. Bitcoin is another currency to Mastercard and the chargeback and consumer protections provided by that network are value-adds for certain transactions.

[Gareth Nelson]

This still needs to be sorted out because Mastercard wouldn't necessarily have knowledge of partner bank's affiliate negotiations.

That is probably true, but the problem is that now that they know about it, they could revoke that bank's authorization to issue debit cards. The fact that MasterCard is coming out and saying they don't have knowledge of this does not bode well for the product launch.

I've refrained from commenting in public on this so far, but here's my own personal view on the matter:

We are making arrangements with a third party, that third party will be submitting the details to mastercard but have not done so yet - hence why mastercard are claiming to have no knowledge.

So far, we're fully in compliance with all the requirements of the third party, we've been talking to them for a long time now to get everything together.

Therefore, there's no reason why mastercard would want to decline the formal submission as doing so would damage their relationship with the issuer we are working with - and we are not their only client.

In short, it'd be suicidal for mastercard to cut off the issuer we're working with just as a spite against bitcoin, especially considering that our planned service brings no increased risk to them.

[Piper67]

This still needs to be sorted out because Mastercard wouldn't necessarily have knowledge of partner bank's affiliate negotiations.

That is probably true, but the problem is that now that they know about it, they could revoke that bank's authorization to issue debit cards. The fact that MasterCard is coming out and saying they don't have knowledge of this does not bode well for the product launch.

I've refrained from commenting in public on this so far, but here's my own personal view on the matter:

We are making arrangements with a third party, that third party will be submitting the details to mastercard but have not done so yet - hence why mastercard are claiming to have no knowledge.

So far, we're fully in compliance with all the requirements of the third party, we've been talking to them for a long time now to get everything together.

Therefore, there's no reason why mastercard would want to decline the formal submission as doing so would damage their relationship with the issuer we are working with - and we are not their only client.

In short, it'd be suicidal for mastercard to cut off the issuer we're working with just as a spite against bitcoin, especially considering that our planned service brings no increased risk to them.

But, to a degree, it becomes a power struggle between the two. We don't know who you're talking to, but we do know how big MC is. If your issuer is bigger than MC, then you're correct, if it's the other way around, then MC could put pressure on your issuer to drop you.

Either way, though, I'm sure you'll have thought of contingencies... like, if what we're looking at is a debit card, then the credit card companies need not be involved at all, right? You could just partner up with a bank and have them issue debit cards, as long as they are members of Cirrus, Plus, Interac and the other networks, those cards could be used all over the world.

[cbeast]

meh, in a few years Master Card will be coming out with a Bitcoin card of their own.

[DeathAndTaxes]

meh, in a few years Master Card will be coming out with a Bitcoin card of their own.

Well probably not, but that is only because MasterCard doesn't issue any credit cards.  Not a single one.  Neither does VISA.

[Boussac]

This still needs to be sorted out because Mastercard wouldn't necessarily have knowledge of partner bank's affiliate negotiations.

That is probably true, but the problem is that now that they know about it, they could revoke that bank's authorization to issue debit cards. The fact that MasterCard is coming out and saying they don't have knowledge of this does not bode well for the product launch.

That was my initial thought too, because something that was relatively innocuous is now on CNN, etc. However, in reality, the affiliate card programs generate transaction/fee volume for MC; they don't care if it's a Planned Parenthood card or an ACLU card or an NRA card. I doubt that this has put bitcoin on any 'special radar' (it's no different than selling bitcoin on your own and putting the value on your Wal*Mart debit card.)

I believe that the BitInstant card will receive approval. The thought that Mastercard is intimidated by bitcoin is funny, because they could co-opt BTC momentum at any time by just adding it to the list of 158 other currencies that they authorize and clear in. Bitcoin is another currency to Mastercard and the chargeback and consumer protections provided by that network are value-adds for certain transactions.

I believe too they will get approval. MC must have understood that they can offer value added services through their members using the bitcoin network. It's a no brainer for anyone with some understanding of bitcoin and some experience in the payment business. MC is a challenger to Visa, that's why they are the first movers.Yet it's a major shift of their current operating model. Bitcoin is still small enough for them to experiment without taking much risks.

[Piper67]

This still needs to be sorted out because Mastercard wouldn't necessarily have knowledge of partner bank's affiliate negotiations.

That is probably true, but the problem is that now that they know about it, they could revoke that bank's authorization to issue debit cards. The fact that MasterCard is coming out and saying they don't have knowledge of this does not bode well for the product launch.

That was my initial thought too, because something that was relatively innocuous is now on CNN, etc. However, in reality, the affiliate card programs generate transaction/fee volume for MC; they don't care if it's a Planned Parenthood card or an ACLU card or an NRA card. I doubt that this has put bitcoin on any 'special radar' (it's no different than selling bitcoin on your own and putting the value on your Wal*Mart debit card.)

I believe that the BitInstant card will receive approval. The thought that Mastercard is intimidated by bitcoin is funny, because they could co-opt BTC momentum at any time by just adding it to the list of 158 other currencies that they authorize and clear in. Bitcoin is another currency to Mastercard and the chargeback and consumer protections provided by that network are value-adds for certain transactions.

I believe too they will get approval. MC must have understood that they can offer value added services through their members using the bitcoin network. It's a no brainer for anyone with some understanding of bitcoin and some experience in the payment business. MC is a challenger to Visa, that's why they are the first movers.Yet it's a major shift of their current operating model. Bitcoin is still small enough for them to experiment without taking much risks.

I think MC would be sold on it if someone explained to them how a Bitcoin debit card would make them a serious competitor to Western Union and other cash transfer methods. They'd probably want a piece of that pie.

[RodeoX]

MC and Visa will support bitcoin for one reason. The only reason they support anything - profit. It is no more complex than that.
Whenever I start a business I try to make the it about one thing, making money. If you are going into business to do good in the world or pursue your dreams, then you are likely going to fail. Your goal should be to make money at all costs. A serious business like MasterCard knows this and they will make their decisions accordingly.

[Dusty]

That is probably true, but the problem is that now that they know about it, they could revoke that bank's authorization to issue debit cards. The fact that MasterCard is coming out and saying they don't have knowledge of this does not bode well for the product launch.

As stated several times in other threads, a MasterCard debit card funded by bitcoins is already available since months by OkPay, so I see no problems why bitinstant should have any problems.