South Korean Credit Card Companies Blocking Overseas Payments

The Credit Finance Association of Korea revealed that South Korean card corporations have been devising ways to block payments to overseas cryptocurrency exchanges, reported local media.

The association is a non-profit organization with 68 members comprising 8 credit card companies, 21 leasing companies, 21 installment financing companies and 18 venture capital companies.

There are precisely 8 members of the association that are card companies: BC Card, Hyundai Card, KB Kookmin Card, KEB Hana Card, Lotte Card, Samsung Card, Shinhan Card and Woori Card.

Business Korea revealed that “Card companies have implemented the system in line with the government’s efforts to wrestle dicey investment in virtual currencies. On the other hand, they express worries over the disagreement from domestic investors. This is for the reason that it can lead to a legal clash when a customer files a suit, since there is no legal basis on prohibiting the payment in foreign exchanges.”

The publication quoted the association on Monday:

Presently, only 20 major digital currency exchanges are blocked, nonetheless we will confirm and share facts about exchanges snatched by individual card issuers. An increasing number of exchanges will be continuously blocked in the future.

The news outlet also cited industry sources clarifying, “Lotte Card and Shinhan Card have introduced systems blocking dealings by investors for the purchase of digital tokens from 20 overseas virtual currency exchanges using either debit or credit cards.” Woori Card allegedly did the same on January 18 whereas other card issuers, including Kookmin Card, are scheduling to complete the blockade by the end of the week.

Additionally, the newspaper pointed out that there is a mounting dispute over how operational this method could be to prevent investors from using overseas exchanges, mentioning that “investors can purchase digital currencies through foreign simple payment systems, including PayPal.”

During the past month, some Korean card companies stopped their credit card points-to-cryptocurrency conversion services. Shinhan Card and KB Kookmin Card have discontinued their service to change card points to Bitcoin, as hitherto reported.


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