New AML compliant bitcoin processing service available to 56,000 merchants
ACI Worldwide recently announced a partnership with Payment21. ACI Vice President Andy McDonald said that the partnership will enable their clients to offer bitcoin payments, “without exposing their merchants to price volatility.”
The new opt-in service uses ACI’s UP eCommerce Payments solution, a network of more than 130 Payment Service Providers (PSPs), supplying 56,000 merchants worldwide. Merchants can now accept anti-money laundering (AML) compliant Bitcoin payments using Payment21’s award-winning technology.
According to the announcement, the team-up has resulted in a platform that “allows PSPs and merchants to quickly and easily add bitcoin payments to their checkout pages, without additional integrations.”
“The solution includes inbound payments and payouts in Bitcoin offering real-time settlement capabilities on a global scale, which accelerates merchant cash flow.”
– ACI Worldwide
Based in Naples, Florida, ACI Worldwide has 57 offices scattered throughout the world, providing payment infrastructure to over 5,100 organizations, including more than 1,000 of the largest financial institutions and intermediaries. Forbes magazine ranks ACI 45th on their list of “America’s Best Small Companies.”
The company is a “Universal Payments company,” claiming “the broadest, most integrated suite of electronic payments solutions in the market.” ACI powers US$14 Trillion in payments and securities every day, and is valued at more than US$2.5 billion.
Payment21 is a Swiss bitcoin payments company owned by Moving Media Gmbh, registered as a financial intermediary with the Swiss Financial Market Supervisory Authority (FINMA), and an International Sales Organization (ISO) in the USA.
The startup is focused on “the compliance needs of enterprise level businesses and the legal prerequisites of their banking partner,” and is targeting publicly-traded companies, licensed gaming enterprises, concessionary wireless network providers and authorized investment funds as potential clients.
Payment21 received the Constantinus Award last June, for their merchant software called the “Bitcoin Cashier System.” The platform is designed to tackle Know Your Customer (KYC) and AML regulations instigated by the US Banking Secrecy Act.
Bernhard Kaufmann, the general manager of Payment21 said that the service, “together with no chargeback risk,” makes enabling bitcoin payments an effective solution for merchants that are seeking to address traditional points of friction, “including delays and costs associated with cross-border payments.”
“[Compliance] makes Bitcoin a viable solution for publicly-traded companies, licensed gaming enterprises, concessionary wireless network providers and authorized investment funds.”
Individual merchants, notably bitcoin exchanges and bank-like companies such as Coinbase, already enforce AML compliance. However, this will be the first time a PSP network has offered a competing solution.
Several industry experts, including the International Monetary Fund, (IMF) and the US Federal Reserve Bank, have all noted a lack of AML compliant merchant solutions holding back Bitcoin adoption.
Last January the IMF published a discussion note called “Virtual Currencies and Beyond: Initial Considerations,” where they define Bitcoin and discuss its role at great length. The note concluded that applying AML controls to transactions can help prevent several “abuses.” However, one of the challenges is “who should bear these obligations.”
Douglas King, a Payments Strategist and Risk Expert at the Federal Reserve Bank of Atlanta, published a paper in 2016 that also discusses Bitcoin and AML compliance risks. “The pseudonymous nature of Bitcoin transactions heighten Bank Secrecy Act (BSA)/Anti-Money Laundering (AML) Act compliance risks,” King wrote, “making it especially challenging for these new businesses to establish banking relationships.”
“By making a commitment to BSA/AML compliance, Bitcoin-related businesses can both better position Bitcoin as a mainstream payment system and enhance the ability of FIs to successfully bank them.”