The recent news that all five of the largest credit card issuers in the U.S. no longer allow customers to purchase digital currency with credit cards, launched a topic of discussion that left many wondering if banks across the world would follow suit.
Despite the example led by banks in the United States, it would seem that the majority of Canadian banks do not have an intent to block digital currency purchases for the time being.
As Bloomberg reported on February 5th, 2018, a spokeswoman from Toronto-Dominion Bank stated that customers can still purchase digital currency with both debit and credit cards. As long as the transaction isn’t flagged as being fraudulent, this means that the average Toronto-Dominion customer can continue with business as usual.
The same can be said for clients of Scotiabank. A spokesman told Bloomberg that at the current point in time there is nothing preventing customers from purchasing digital currency with their issued credit cards. Although they may revisit that policy at some point.
“There is nothing that would generally block a transaction,” Scotiabank said. “However we are carefully reviewing our policy.”
While the Royal Bank of Canada is currently reviewing their policies in order to consider the risk factors involved with digital currency spending, the bank does not prevent users from making digital currency purchases in most cases. This is also the case for the National Bank of Canada, which also allows digital currency purchases.
Controversial statements from U.S. banks
At the current point in time, the verdict is that the majority of Canada’s largest credit card issuers are yet to agree with the stance taken by the five largest issuers in the United States. This represents a broader shift in opinion between the banking industry of the two countries.
In fact, two of the largest U.S. credit card issuers made comments on digital currency that were received unfavourably by the community.
“It’s crooks that are trying to get money out of China or wherever,” said Discover Financial CEO, David Nelms in January of 2018. “Or if someone steals our credit card numbers they’re going to ask for payments in Bitcoin. Those are the only use cases I’m actually seeing today.”
Similarly, JPMorgan Chase CEO, Jamie Dimon, made controversial statements about digital currencies in 2015, although he later stated that he regrets getting involved.
“It’s just not gonna happen, you’re wasting your time. This is my personal opinion. There will be no real non-controlled currency in the world,” said Dimon. “There’s no government that’s gonna put up with it for long.”
Canadian banks still allow digital currency purchases on credit card
The majority of Canadian banks are yet to voice harsh opinions against digital currencies. In fact, the Bank of Canada made headlines in December of 2017 with the release of a white paper exploring the possibility of creating a digital currency of their own
Here, the bank evaluated the possibility of creating a Central Bank Digital Currency (CBDC), listing both the risks and benefits. At the time, the paper was seen as further legitimizing the industry.
Ultimately, while Canadian institutions are free to re-evaluate allowing customers to purchase digital currency with their credit cards, the decision of U.S. banks is yet to change the landscape for Canadian credit card holders.