Binance has decided to discontinue its crypto-backed debit card services in both Latin America and the Middle East. While the exchange didn’t provide a specific reason for this decision, it mentioned that less than 1% of its users in these regions would be affected.
The card service will cease operations in the Middle East on August 25 and in Latin America on September 21.
The Binance debit card allows users to utilize their cryptocurrency assets to make purchases in stores or online, similar to how a traditional debit card issued by a bank would work.
The card was introduced in Latin America less than a year ago, first in Argentina in August and then in Brazil in January. It’s issued by Movii and allows users in the region with a valid national identity document to make purchases and pay bills with cryptocurrencies.
Despite discontinuing the debit card services, Binance explained that users will still be able to process refunds and disputes until December 20, 2023. The company also clarified that this change won’t impact Binance accounts globally. Users will still be able to shop with crypto and make use of Binance Pay, a contactless and secure cryptocurrency payment technology developed by the crypto giant.
“Binance accounts around the world are not affected. Where available, users can also shop with crypto and send crypto using Binance Pay, a contactless, borderless and secure cryptocurrency payment technology designed by Binance,” Binance said.
Binance lets clients top-up their card with funds through the Binance Card App and then convert their crypto holdings to fiat within seconds, which can be spent at over 90 million Mastercard merchants worldwide. Whenever a cardholder makes a payment, Binance Card instantly converts the cryptocurrencies into other fiat currencies and automatically deducts all expenses and commissions.
This move comes shortly after the exchange decided to shut down its crypto payments service, Binance Connect, in order to refocus on its core products.
The exchange’s actions are also taking place against the backdrop of regulatory challenges and inquiries from various partners. Earlier in August, London-based payment processor Checkout.com terminated its contract with Binance due to concerns over compliance and money laundering. Binance refuted Checkout.com’s reasons and is considering potential legal action. This decision followed a similar move by Paysafe Payment Solutions, a European provider, which announced it would stop offering its SEPA payments to Binance.