An Update on Credit Card Payments and a little rant on local Banks

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An Update on Credit Card Payments and a little rant on local Banks

We note that it’s almost been a month since we’ve been unable to accept credit cards via the MolPay channel as per our earlier post but only through the Paypal channel and we felt we owed our customers some explanations for those who sought them.

Your Privacy when it comes to Payments: Credit Cards are Poor

First of all technically, there shouldn’t be any difference from paying via Paypal or MolPay, both retain payment details like any other credit card processor and so is a poor form of anonymity unless you can use a prepaid credit card. As far as we know it’s not compulsory to have a Paypal account to pay via Paypal. The only difference is perhaps that Paypal is a US company while MolPay is a local Malaysian one.

For most people though this isn’t a concern since their usage of a VPN is trivial and need for privacy not so extreme. Credit cards are a convenient way to pay hence we maintain this payment method.

Banks being Difficult

Due to new regulations issued by our central bank to combat online fraud cases, banks have required more and more documentation from merchants to prove that we’re legit businesses. My frustrations are actually echoed by Faiz from ESentral Blog in his post. Banks even with our additional documentation provided feel that our business is high risk despite our long track record and our ranking as one of the major players in the VPN world. One bank (Alliance Bank which was processing all our orders all this while) has already denied our application to accept credit card payments on the basis that we are high risk. We are told web hosting providers have also been denied so their problem is not that we are a privacy service but purely because our product is ‘intangible’. Basically our economy isn’t developed enough to realize that online purchases of services are a standard part of life now and taking poorly thought out steps to verify businesses (like requesting for a picture of a workstation).

Why haven’t you found an alternative payment processor?

There are also only three payment providers open to us as Malaysians. Paypal, IPay88 and MolPay. WorldPay does not accept Malaysian vendors and 2CheckOut as far as we know wouldn’t deal with our services (and not to mention a HUGE percentage commission) so we’re left with very few options. Paypal, we still have it working but users do not trust them. IPay88 and MolPay both use the same banks, Alliance and Hong Leong Bank, one which has denied us already and the other is still processing our application.

Why has this taken so long?

We were told early February and given 3 days to comply which we rushed our heads off and did so. Then Chinese New Year came about and applications came to a standstill for 2 weeks. Our application was forgotten and due to a mess up at MolPay, we were told our application wasn’t complete (when it was). After a huge scolding, they apologized and submitted and we’ve been following up every day. We even arranged a meetup with them to make sure things went smoothly but they said it was out of their control since it lay with the banks. Current status is that they are still checking with Hong Leong whether they would accept us.

This is the latest e-mail we got:

Kindly be inform that we have contacting the bank site and sorry to inform that one of our processing bank (ALB) did not allowed merchant with hosting provider to process e-commerce (credit card) through them as it is due to the highrisk MCC code (bank compliance and regulation). But our management in progress to have some negotiation with their site to accept this business nature.

Regarding for another processing bank (HLB), they are still in the middle to process your application and we will revert to your site if we do received any feedback from bank site.

What would you recommend?

If you’re just using a VPN for normal privacy, Paypal should be a reasonable option and shouldn’t be significantly less private than a credit card payment through MolPay. However, the most anonymous forms of payments would be a cash deposit into an ATM machine or for our international users a BitCoin payment.

How do you get BitCoins?

Here is the official guide, though however if you are Malaysian, you may consider using DgtMkt whom we have some experience with and have thus far been reliable.

If you’re in US, and want to get Bitcoins anonymously, here’s a guide:

  1. Download and install TOR from https://www.torproject.org/
  2. While using TOR create a Tormail account at http://jhiwjjlqpyawmpjx.onion (You need to have Tor installed)
  3. You can confirm the address at http://tormail.org/
  4. While using TOR, visit http://www.bitinstant.com
  5.  Choose the Cash deposit to Bitcoin to email option.
  6.  Follow the instructions on Bitinstant to make your cash deposit, and have your Bitcoins sent to your new Tormail account. No ID is needed.
  7.  Receive your Bitcoins via email.

Thank you for your understanding and we’ll keep you posted on the situation.

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