Paysafecard Begins Banning VPN Providers

In line with recent trends, the electronic payment method paysafecard has put a blanket ban on VPN services.The company states that these type of services in combination with its core product paysafecard are internally classified as high risk since they could be used by people who “have something to hide.” The "Pirate Bay" VPN iPredator is one of the services that was rejected recently, after they also lost Mastercard and Visa as payment options.

paysafePayment services are increasingly taking action against VPN providers, and as of today paysafecard can be added to the list.

Paysafecard is a popular prepaid coupon sold at 450,000 sales points in dozens of countries. It is accepted by Internet companies worldwide, including many gambling sites and file-hosting services such as RapidShare and Netload.

The payment method recently gained the interest of iPredator, a VPN provider launched by Pirate Bay founder Peter Sunde. After losing Visa and Mastercard as a payment option, as well as recent troubles with PayPal, the Swedish VPN provider needed another payment option.

However, when iPredator decided to sign up with paysafecard the alarm bells began to ring in the company’s internal control department. “We don’t work with VPN services,” was the reply paysafecard sent, denying the application.

Hoping to get some more details on this strong anti-VPN stance TorrentFreak contacted the company. paysafecard’s PR Specialist Michaela Unger informed us that they don’t accept VPN services because these allow users to spoof IP addresses.

“In terms of security it is seen as a very high risk for paysafecard, because you cannot trace where the information is coming from,” Unger says.

“In many cases VPN services are used for businesses which have something to hide – this can be any illegal business because if the IP address is spoofed, you cannot trace where all the information is coming from. People can hide a lot of illegal content and you will never be able to detect the original source,” she adds.

Paysafecard is the first payment method to confirm a VPN ban. Earlier this year the Swedish payment service provider Payson outlawed anonymizing services as well, but only for Visa and Mastercard payments.

Interestingly, paysafecard still lists a VPN provider as one of their merchants, but this will probably change in the near future.

It is unclear what evidence of abuse the company has seen. There are obviously plenty of legal uses for VPNs. The news, however, does follow a trend in which online payment systems take action against VPNs.

For example, one large European payment processor informed iPredator that they have been put on a blacklist of services that are not allowed to accept credit card payments. TorrentFreak previously asked both MasterCard and Visa about the claims of an operational blacklist, but both companies denied one exists.

Mastercard’s Senior Vice President of External Communications, Andrew Bowins, told us that they have no policy to ban VPN services, but that they occasionally disconnect merchants who violate their terms.

“We don’t currently have a policy that unilaterally prohibits VPNs or anonymizers. That said, in order to protect the integrity of the payment system and its participants, we do review merchants to determine whether their models are in compliance with our rules,” Bowins told TorrentFreak.

Neither MasterCard nor Visa could confirm that iPredator was allowed to process credit card payments.

The big question is, why are VPNs slowly starting to lose access to online payment systems? Is it all a coincidence or are we witnessing a coordinated push against anonymizer services? Are there any agreements being made behind the scenes to target these services?

If that’s indeed what’s going on, how long before VPNs become illegal?

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