BOV to stop Mastercard, clients informed Visa is their only option

Thousands of Bank of Valletta clients holding a Mastercard were given until the end of November to continue using their credit card as ‘Malta’s largest bank’ will cancel the service as of 1 December.

As an alternative for this sudden decision, BOV clients are being offered to be enlisted onto the Visa credit card programme, free of charge, where all their dues pending on their Mastercard will also be transferred onto the new credit card system.

Contacting The Shift News after being informed of this decision, BOV clients described the instructions given by the bank as ‘strange’ and questioned whether this is somehow connected to the recent difficulties being faced by BOV and other local banks due to Malta’s dip in international reputation as a financial institution, including the island’s greylisting by the FATF.

When contacted, a spokesman for the bank vehemently denied any connection between this decision and Malta’s ongoing reputational difficulties, attributing this decision as “purely a business and strategic one”.

“Visa and Mastercard have almost identical global acceptance, meaning that wherever Visa is accepted Mastercard likely is too,” the spokesman said.

“Customers who only hold a Mastercard with Bank of Valletta are being offered a Visa card as an alternative so that they can continue availing themselves of the benefits of these credit cards,” the spokesman added.

The Shift has also independently verified the explanation given by the bank, with financial services experts confirming that the decision has nothing to do with the ongoing reputational trouble facing the island.

“Mastercard and Visa are just technology companies and do not handle any credit. This means that such a decision by the bank has nothing to do with other issues currently affecting Malta,” a senior financial practitioner told The Shift.

During the past years, BOV has hit the headlines on several occasions, particularly due to its role in the downfall of Malta’s international reputation which resulted in a damning report by Moneyval and an eventual greylisting by the FATF.

For many years, BOV was the main bank used for certain suspicious transactions, particularly following Labour’s return to power in 2013.

In 2019, the bank, following an inspection, was slammed by the European Central Bank (ECB) for various failures with regards to anti-money laundering rules.

According to a confidential report by the European Central Bank, BOV had not dealt with a litany of risk management failings despite repeated warnings from the Frankfurt-based regulator stretching back to 2015.

The report called for remedial measures, including assessing if BOV’s top managers were fit for their jobs and reducing exposure to risks posed by foreign clients.

For several years, BOV was chaired by Deo Scerri – the former auditor of the Malta Labour Party. He was forced to ‘retire’ following the ECB’s report.

BOV also acted as the ‘correspondent bank’ of the now-defunct Pilatus Bank, used by high profile foreign clients, including politicians, to allegedly launder millions in transactions.

The FIAU has not taken any action, so far, about BOV’s role in the Pilatus affair while it fined the de-licenced bank €5 million. Pilatus is contesting this decision.