UK-based gold and bitcoin exchange Netagio has announced a new partnership with payment services provider WalPay that will give it vital access to the traditional banking system.
The new relationship means Netagio customers can now deposit funds and receive international payments in GBP, EUR and USD. The firm indicates that other currencies are to follow in the future.
Additionally, customers will soon be able to make credit and debit card payments to their Netagio trading accounts. The firm said Visa, Visa Electron, Visa Debit, MasterCard, MasterCard Debit and Maestro cards will be accepted.
While no concrete date is set for the rollout, the firm indicated it plans to have card payments in place during the last quarter of 2014.
Justin Martin, head of business development and sales at WalPay, said:
“We are thrilled to be working with Netagio to secure new robust banking facilities for their customers today, and also to work on introducing credit and debit card payment functionality in the very near future.”
WalPay is an Isle of Man-based payment service provider bringing banking solutions to a variety of European merchants. The firm is licensed by the island’s Financial Supervision Commission.
Banking crisis
The news comes in the wake of recent problems on the Isle of Man, where Netagio’s holding company is based.
In mid-September, payment services provider Capital Treasury Services (CTS) announced that, due to pressure from its UK banking partners, it would close all accounts belonging to cryptocurrency businesses.
Until this point, CTS had relationships with a number of bitcoin companies on the island.
While the move sent an initial shockwave through the cryptocurrency space, it quickly became clear that other companies, such as WalPay and Instabill, could possibly step in to fill the space vacated by CTS.
The Netagio announcement is the first sign that, indeed, the Isle of Man’s bitcoin companies can still find access to the banking system and that business could soon return to normal.
Simon Hamblin, CEO of Netagio, told CoinDesk: “We have been working with WalPay for about six [or] seven weeks in preparation for the credit and debit card integration and before the CTS issue emerged in the IoM.”
He added:
“We knew that WalPay could also secure European banking relationships, so when UK banks pulled their services from the IoM, we were already well placed to put new systems in place.”
Banking in the Eurozone
Walpay provides Netagio access to European banking via TrustPay, which is authorised and regulated in accordance with the European Payment Services Directive (2007/64/EC).
This does mean, however, that Netagio’s banking partners are no longer British. As a result, UK customers cannot make domestic bank transfers.
Hamblin explained that “deposits can be made in GBP, but they have to be made to a European bank and are subject to international transfer fees and time delays (three working days)”.
One of the issues with the CTS relationship appears to have been that UK bank partners had not been aware that they were banking bitcoin companies and when the fact was discovered, they withdrew their services.
Hamblin said that will not be an issue with the WalPay relationship:
“Our banking partners are fully aware that we are a bitcoin business. Across Europe, various local jurisdictions continue provide bank accounts to bitcoin businesses. Sadly, this is no longer the case in the UK.”
Cryptocurrency appeal
In the months before the CTS crisis, the Isle of Man had been touting itself as a cryptocurrency-friendly jurisdiction in hopes of attracting new business to the island.
Not part of the UK or the European Union, the island is a self-governing Crown dependency. It is making moves to set up a regulatory environment that intends to protect consumers but also encourage businesses that work with cryptocurrencies. Additionally, a cryptocurrency incubator has been set up by a consortium of local business to further boost the appeal of the island.
The recent Crypto Valley Summit event was based in the capital, Douglas, but was marred by the news of CTS withdrawal of facilities.
However, what could have been a disaster for the island’s plan to support cryptocurrency businesses now looks like a mere hiccup.
Isle of ManNetagioWalPay
Original author: Dan Palmer