PayPal Pulls MEGA Support

PayPal has ceased supporting customer payments for MEGA as of Friday. A post on MEGA’s blog suggests that PayPal has refused to handle the cloud storage service’s transactions due to its presence in a NetNames report accusing it of being an illegitimate business, and subsequent pressure by Visa and Mastercard.

The blog reads:

MEGA is aware of a report published by NetNames (partially funded from the MPAA supported Digital Citizens Alliance) that incorrectly claims MEGA’s business to not be a legitimate cloud storage service. MEGA is aware that Senator Leahy (Vermont, Chair Senate Judiciary Committee) then pressured Visa and MasterCard to cease providing payment services to the companies named in that report.

Visa and MasterCard then pressured PayPal to cease providing payment services to MEGA.

Though PayPal later acknowledged that it considers MEGA to be a legitimate operation, it decided to maintain its embargo, citing the “unknowability of what is on the platform,” effectively penalising MEGA for using effective end-to-end encryption.

While PayPal continues to withhold its service, MEGA says it will not punish its customers over it:

Until new payment systems are implemented, MEGA will temporarily not enforce its storage limits or suspend any accounts for non-payment and has extended existing subscriptions by 2 months free of charge.

MEGA has 15 million customers across 200 countries using its cloud storage service. It was launched by web entrepreneur Kim Dotcom as a secure alternative to the likes of Dropbox, after the service gave the NSA access to user data through the PRISM initiative.

Source: MEGA