Visa Makes Significant Change To How Coinbase Transactions Are Labeled, Causes Duplicate Charges On User Bank and Credit Cards
While Coinbase has experienced numerous technical problems in the past, it appears the latest glitch is not the company’s fault.
There have been many reports that Coinbase users were noticing odd charges on their debit and credit cards – some doubled-charged for an old transaction with some users being hit with 50 or more duplicate charges.
This has caused a major uproar with users, as it’s causing some users to have overdrawn bank accounts or maxed out credit cards. It was not very clear what was causing these additional charges, but Coinbase has reached out to the public, shedding some light on the problem. After all, some users accused Coinbase of taking money out for their own gain.
Coinbase said the problem was related to Visa – its credit card processing company. Allegedly, Visa is reversing and re-charging previous charges after the company decided any Coinbase transactions would be labeled as cash advances.
Not too long ago, the majority of card issuers and banks have reclassified Coinbase as a Merchant Category Code, meaning any of its usage would be considered cash advance and subjected to a higher fee. For Coinbase, this is not a good thing, as it could hinder the startup in growth and ultimately cause users to stop buying cryptocurrency with credit cards.
Visa is, without warning, reversing and recharging some of the transactions that took place between Jan. 22 and Feb. 11 to classify them as being MCC. These transactions were refunded and then recharged at the same time, which means, in theory, users should not have seen any major problems except for the increased fee with the new MCC code.
However, most people know that credit card and banking systems don’t update automatically, especially when it comes to refunds, which often take days for completion. This caused some users to have duplicate charges.
Coinbase said, in due time, all users will be refunded their money. And, the company is working with Visa to ensure this takes place. They will also contact affected customers – to ensure their balances and transaction history are correct.
It’s not known how many people were affected by the overdraft fees base of the issue, but Coinbase said it would rectify any problems related to this problem.
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