Monday, June 17, 2024

Two bankers warn against using credit cards to buy digital currencies – economy – local


Two bankers, bank dealers, have warned against using credit cards to buy Bitcoin or any digital currency.

They explained to “Emirates Today” that banks consider buying digital currencies using credit cards as a cash withdrawal from the card directly, and prescribed fees of 300 dirhams apply, which are deducted directly from the card balance, in addition to deduct a percentage of the amount used in the purchase.

The Central Bank had warned more than once about the dangers of digital currencies, since they are not subject to any regulatory authority, and there is no legal regulation for them that guarantees the rights of traders with them, or prevents their exploitation in suspicious transactions.

The banker, Muhammad Ghazi, said that the first piece of advice bank employees give dealers when they get a credit card is to use it only for purchases and reservations, and to completely avoid using it to withdraw cash from ATMs, due to high fees. ranging between 200 and 300. One dirham, although the amount withdrawn is slight.

He emphasized that the matter does not stop there, but that the banks impose a percentage deduction of the value of the amount withdrawn, which will be deducted daily until the total amount used from the card is paid.

Ghazi added that digital currencies have an exchange rate, like the rest of the traditional currencies that are handled, such as the dollar or the euro, or others. Therefore, banks look at them based on the fact that the purchase was made in cash. , no “purchases”, and Direct Cash Withdrawal Fee applies.

He explained: “Even if the customer pays the amount withdrawn (cash) from the card, the estimated fee in a percentage of the amount remains deducted daily until the total amount used from the card is paid, since the bank system does not know the purpose of the payment, and if it is for Regular purchases or for withdrawal (cash) ».

It details: “If the customer withdraws an amount of 500 dirhams, for example, a fee will be imposed that will range between 200 and 300 dirhams, in addition to a daily percentage equivalent to the percentage that is imposed on purchases. In the event that the client pays the amount of 500 dirhams withdrawn, the commissions that are imposed daily do not cease, since the bank’s system does not know if the amount paid is in favor of withdrawing (cash) or purchases, and therefore, the commissions do. it does not stop, except when paying the total amount used on the card ».

Paid cards

For his part, banker Ahmed Salem said that banks deal with the purchase of digital currencies using a credit card, the transaction of withdrawing “cash” in terms of imposed fees, noting that they are high, expensive and cumulative fees. It is preferable to use the dealer who wants to buy Bitcoin or any digital currency A, his direct debit card or prepaid cards, indicating that this prevents the customer from imposing commissions on the part of the bank where his bank account is located.

He added that prepaid cards are available with nominal fees in banks and exchange houses, and they are cards that can be filled in advance with the amount that the client wants, and then used wherever they want without commissions or interest, unlike a card Credit that Banks charge a high fee when used in purchases or withdrawals.

• The Central Bank warned about the risks of digital currencies, as they are not subject to any regulatory authority.

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Ebenezer Robbins
Ebenezer Robbins
Introvert. Beer guru. Communicator. Travel fanatic. Web advocate. Certified alcohol geek. Tv buff. Subtly charming internet aficionado.

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