Topic: Need some feedback on a potential reloadable prepaid VISA program (Read 4628 times)

Read the rest here: http://www.dailypaul.com/106790/opening-a-bank-account-without-an-social-security-number

Thank you ArticMine those are very good points.  I will bring it up to the issuers we are in talks with. 

But are they re-loadable? I do not think so. What makes this product attractive is that it is re-loadable.

Well there are 'persons' in California that can get Pre-paid cards without a SSN but they do need to provide a consulate Id Number.


Technically that wouldn't be a SSN/EIN/TIN.

So, Hola!

A very common reason why a non US resident would want a USD Debit VISA card is to purchase goods and services online from websites in USD. This avoids the currency conversion fees as the entire transaction is in USD. In addition many US based retailers do not accept non US based credit cards for fear of fraud. There are also persons who for example travel to the US and would want to use it in the US when visiting. Here in Canada the major banks actually issue USD denominated credit cards for this very reason.

There are also those non residents who have a vacation property, business and / or investments in the US and would want use such a card to pay for goods and services related to their business etc. In addition one has those that wish to hold funds in USD in the US for the very same reasons many US citizens and residents may wish to hold funds in a non USD currency outside of the US.  It works both ways.

The next group is those that cannot get a VISA or MasterCard branded Debit or Credit card in their own country. In many parts of the world, unlike the US,  debit cards that operate as credit cards are either impossible or very hard to get, so this becomes a very attractive option in this case.

By the way funding a US based bank account / debit card with Bitcoin avoids one of the biggest costs and hassles for a non US resident in holding a US bank account; namely funding it, especially with small amounts.

What you will find is that most card issuers will only deal with US residents, because they can not be bothered to research the AML properly; however if you find one that does then this can be a huge business opportunity.

Thanks for your feedback.  You are correct and I didn't mean to indicate otherwise.  I may have simply been unclear.  The terms of the program are set by the card issuer.  If the card issuer limits the program to US residents then we are constrained by that decision.

We haven't signed any deal yet and will continue to explore all vendors.  I do see 38% of the pool is interested but not eligible.  Maybe you can provide some insight into the value of USD denominated card for non-US residents.  Most cards will charge a conversion fee tp convert to local currency which adds to the effective cost of any cashout.  Doesn't that limit the usefulness is areas of world where the local currency isn't USD?   Even if you lose 2% via currency conversion you would still be interested in a dollar denominated card?

I would strongly suggest that you consider opening this up to non US residents since this is where the real opportunity and demand will be. It is a hugh myth perpetrated by many in the US financial industry that the Patriot Act and related AML requires that one be a US resident with a SSN in order to be able to open a US Bank account or obtain financial services in the US. Nothing can be further from the truth. A non US resident can open a bank account in the US provided they have a TIN (Taxpayer Identification Number from the IRS). One note however the use of a non SSN TIN in this context by a US resident may be against the law.

To quote the Bank Secrecy Act, Anti-Money Laundering and Office of Foreign Assets Control Introduction to the Bank Secrecy Act. http://www.ffiec.gov/bsa_aml_infobase/documents/FDIC_DOCs/BSA_manual.pdf (My emphasis in bold)

Im looking for the same response.

@check_status, you said in your response you were able to open a bank account without an SSN. To me, and most of us, that implies that somehow you were able to bypass some AML+KYC requirements banks have. You then responded something about the difference between EIN, TIN, and SSN (Which most of us knew already but didn't answer the question)

We're not trying to shamble you here or anything, believe me I have better things to do 

The banking system is a learning experience for me, if you know something that I dont, tell me!!!!!

So you used an EIN or a TIN instead of a SSN to open your bank account? You haven't actually said.

SSN, EIN, TIN are generated by the same computer system, the numbers do not overlap. If I open a business and get an EIN (no need to be a corporation, though corporations are people) and then present it to those asking for an SSN there is no way for them to know it is not an SSN. And as for TIN's anyone can ask for those, they hand them out like candy. Not to worry though, the National ID Card will change all of that greyness and screw us all equally.

Now that DeathAndTaxes has relinquished his prized avatar, are we going to have to bear seeing a Seasonic avatar? 

This account will be taking posting on topics related to our ventures.

D&T personal account will still exist but given his sometimes confrontational posts it is likely a good idea to begin to develop a separate entity to represent the interests of Tangible Cryptography LLC.

If you are suspicious (well good for you, trust but verify) D&T vouched for this account here:
https://bitcointalksearch.org/topic/whitelist-requests-want-out-of-here-15911

Haha wow I did not notice that. Never underestimate this forum...

I am sorry you feel that way but I do value your feedback.  You may be interested to know that Tangible Cryptography has also been seeking solutions which will allow instantly purchasing bitcoins with lower risk of fraud (and thus lower fees).  Unfortunately we were turned down by one irreversible payment processor due to "insufficient cash reserves and lack of proven processing volume".  We have to start somewhere.  It is our hope that we can leverage one program to get a foot in the door with other processors.

In time we hope to prove to you that lower barriers between fiat money and bitcoins will bring in more casual users and that strengthens not weakens the system.

Imagine if someday you could buy a bitcoin prepaid card at any convenience store with cash just like you can facebook tokens.  Imagine if a user could enter the scratch-off pincode and Bitcoin address on a website and instantly fund that address based on current exchange rate.  How would that impact the Bitcoin ecosystem?  We aren't going to get there from here without steps along the way.

He might be a trust fund baby. It's the trust's EIN/TIN.

Or it's a BCST account.

Notice how he used the word "my" when he said SSN? Just sayin...

I would like to know the answer to that also.  Which US bank lets you open an account without SSN?  It would be good info to know, maybe they will help us issue CC without SSN also?   If you last opened a bank account or obtained a credit card some time ago you may be unpleasantly surprised to find that KYC & AML requirement have gotten a lot tighter in the last few years.

How?

(A corporation with an EIN is doesn't count as 'SSN is not a requirement' )

This offer highlights a lack of dependency on Bitcoin as a currency and brings dependency to the use of Credit Cards and their processors. It will keep Bitcoins a hobby while these cards become the new currency. While it may be progress, I see it as backwards progress and not forward progress for Bitcoins. That said, you are doing what you feel is needed based on your experience. I hope you succeed in providing a solution that benefits Bitcoin and profit for you.

I opened a bank account without using my SSN, so an SSN is not a requirement.

That would be the ultimate solution however it requires a very high level integration with credit card processing network.  

The CC networks have a lot of layers:
Network provider (VISA, MC, AMEX)
Issuing Bank (Bank Of America, HSBC, CapitalOne)
Independent Issuer (Green dot, Netspend, etc)
Cobranded or white label solution (limited by capabilities of the independent issuer)

When a merchant swipes your card the request goes to the merchant's bank who sends it though the proper network (card type) to the issuing card's bank.  The request doesn't go any further down "the chain" than the issuing bank.  The bank looks at the funds available, card status, etc and either approves or declines the authorization.    So unless there is an issuing bank (and I do mean a bank, not a financial company like Paypal or Netspend but a bank) that is willing to hold bitcoins as collateral and approve tx, and then sell enough coins to cover the charge I don't think we will see a solution like that.

One more modest option would be a an "auto charge" system.  It would require an issuer which allows a company to see your account balance.  When it drops below a user set amount the company sells enough coins to replenish the account.  Even that requires a higher level of integration than I think is possible at this stage but wouldn't require the issuing bank to be involved.

So another distributor contacted us and I think we have a solution which addresses at least some of the concerns in this thread.

The fees
Card issue fee: $9.95 (includes first year annual fee)
Annual fee: $9.95 (charged on the anniversary date of card issuance)
Load fee: in negotiations but likely $1 ($0.00 for loads >$500)
ATM withdrawal: $2.50
ATM inquiry: $1.00
ATM decline: $1.00
Transfer to checking account: $0.35
Direct transfer to another cardholder: FREE
PIN Based transaction: FREE
Signature Based transaction: FREE
Cashback / Cashover on transaction: FREE

The bad news
KYC information required (including SSN).  Today it is simply not possible to find a US based card issuer who doesn't require SSN for reloadable cards.  We have had phone conferences with at least two dozen issuers.  You can thank Patriot Act and AML regulations.   Card offer is for US residents only.  

The limits
Initial load: $1,000
Reloads: $5,000 per day
ATM Withdraw: $1,000 per day
Purchases: $2,500 per day

The good news
Loads are instantaneous.  

The "interesting"
They have an option of custom branded cards with any graphical design trademarked by us.  However Mastercard must approve all card designs. What are the odds someone at Mastercard will approve (or even recognize) a card design which contains a bitcoin logo?

Funds can be transferred BETWEEN cardholders for a fee of $0.30.  The salesman seemed to indicate these card to card transfers are  irreversible.  When I pushed him on it he said he would get further clarification.  Funds can also be transferred to user's bank account.