It wasn't Malaysian regulators that suspended the dealership branch but instead the auto manufacturer, Proton Holdings. A Selangor-based Proton dealership took it upon itself to begin accepting bitcoin as a form of payment. The problem is that automaker Proton never gave the dealership the green…
It wasn’t Malaysian regulators that suspended the dealership branch but instead the auto manufacturer, Proton Holdings. A Selangor-based Proton dealership took it upon itself to begin accepting bitcoin as a form of payment. The problem is that automaker Proton never gave the dealership the green light, with the company saying it doesn’t recognize cryptocurrencies as a payment method and as a result was suspending the dealership pending an investigation.
Meanwhile, Proton may be cutting off its nose to spite its face. Dealership owner Tony Yeu, who is trying to bolster flagging sales, said that since he began taking bitcoin as payment, customer interest has piqued, according to reports.
“I put the banner up last Thursday night and since the next day, there was an increase in number of inquiries. Daily there are more than 10 people who will walk in, even the number of calls that we have received being interested to purchase using bitcoin has increased,” said a defiant Yeu, who according to a separate report, plans to continue taking bitcoin.
Proton’s position is the following:
“Proton is open to innovative ways of car sales to keep customers’ interest in our cars. However, we would also like to caution our sales network to exercise consideration and due care in carrying out promotion activities which are not endorsed by the company,” according to a company statement.
It’s not that Proton Holdings couldn’t use the boost. Proton sales fell nearly 2% in 2017. The decline was due to falling taxi orders, not performance at retail spots, but nonetheless, sales fell from 72,291 vehicles to slightly less than 71,000 last year.
Though Yeu has removed the banner promoting bitcoin as payment, he’s developed a workaround to continue offering the service. Car buyers can transfer down-payments or the full-price of the vehicle, which despite the bitcoin price’s recent pullback is increasingly a possibility given the quadruple-digit gains in 2017, to the dealership owner’s personal digital wallet. He plans to tack on an additional 2% fee on top of the invoice price to offset the roller-coaster ride in the bitcoin price.
Taking bitcoin is Yeu’s last-ditch effort to keep the doors open at his Proton dealership, amid a goods and services tax added a few years ago that has taken a toll on sales.
Malaysia’s Bank Negara doesn’t treat bitcoin or altcoins as a legal form of payment, meaning users aren’t “covered” in legal disputes, but a full ban doesn’t appear to be in the cards, either. Meanwhile, cryptocurrency exchanges as per the Malaysian central bank must report activities. In recent days, the Inland Revenue Board of Malaysia suspended London-based cryptocurrency exchange Luno’s account pending a tax investigation.
Featured image from Shutterstock.
Last modified: January 9, 2020 12:02 PM UTC