PARIS - Airbnb agreed Monday to withdraw a payment system in France, suspected of facilitating tax avoidance, after the government complained it could potentially be used to launder money and lead to a loss in revenues.
The move followed a meeting between the accommodation rental website's executives and government ministers, including French finance minister Bruno Le Maire, where the company agreed to "rule out any opportunity for open fraud" by using prepaid Payoneer cards.
"The company will waive all use of the prepaid card 'Payoneer' on the French market," said Emmanuel Marill, Airbnb's France director, in a statement released by the finance ministry.
"This responsible decision makes it possible to rule out any opportunity for open fraud by using this method of payment," said the statement.
Payoneer cards allow homeowners to receive payments for their rentals without money transiting through bank accounts.
The French government asked tax authorities to look into the system after it was revealed that Airbnb was allowing owners to use them.
Le Maire and budget minister Gerald Darmanin had reminded Airbnb bosses of "the legal obligations in terms of declaring income generated" in France, the statement said.
Airbnb said that fewer than one percent of hosts in France used the system but that it wanted to "respond to concerns linked to possible debit card abuse".
Several online retailers, including Amazon, accept Payoneer cards as a payment option.
Payoneer said Monday evening that it was "a regulated payment company, which operates in total conformity with the laws and regulations of the European Union," and that "the idea that Payoneer products would help avoid paying taxes or allow money laundering is categorically wrong".
"It is incumbent on Airbnb hosts in France to declare their income to the tax authorities, whether they are paid into a French bank account, via PayPal or via Payoneer," said the financial services company, which is based in New York and has a European subsidiary in Gibraltar.
Airbnb also came under pressure on Monday over the speed at which it removes rental adverts that do not include a number showing the property has been registered with local authorities.
Since December 1, anyone wishing to rent their Paris apartment on the site has had to request a registration number, which has to appear on Airbnb listings.
The Paris mayor's office warned Airbnb and other rental sites that they could face legal action if they do not "withdraw ads without a registration number".
Short-term rental homes are allowed to be rented for a maximum of 120 days per year if a primary residence, according to the rules.
Some locals, hoteliers and politicians claim the widespread use of Airbnb has aggravated a housing crisis in the French capital.