UK Banks: Where They Stand on Facilitating Crypto
- Written by: Gary Howes
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A look at the latest policies at UK banks regarding the facilitation of crypto payments and withdrawals.
The crypto market looks a lot different today than it did fourteen years ago when Bitcoin, the first digital currency, was created.
No longer a peculiar digital novelty shunned by businesses and organisations, crypto has made a name for itself as a powerful and innovative technology that has the potential to revolutionise the global financial system, carving a clear path towards mainstream acceptance.
The demand for cryptocurrencies has grown steadily over the years as an increasing number of institutions and individuals started using crypto either as a form of investment or as an alternative payment method to purchase an ever-expanding range of products and services.
With exchange platforms like Binance making it easier for people to buy Bitcoin and altcoins, the barriers to entry were greatly reduced and crypto awareness increased substantially.
Despite their well-known volatility and the lack of regulatory clarity, digital currencies continue to grow in popularity, and the large crypto community amounting to approximately 420 million people around the world, stands as proof of their staggering progress.
And yet, in spite of their promise and evolution, UK banks seem to be pulling away from crypto.
The reasons for this pullback are multiple, ranging from concerns regarding the high risks that this asset class implies to regulatory uncertainty and the 2023 baking crisis that began with the collapse of Silicon Valley Bank.
In this context, traders, investors and average crypto users would benefit from staying up to date with the latest banking rules regarding crypto use and what they involve.
Revolut
As a digital bank that provides its services exclusively online through a mobile app, it comes as no surprise that Revolut takes a slightly different stance on crypto than traditional banks. In fact, Revolut is among the most crypto-friendly platforms in the world, providing a variety of cryptocurrency products and services to its customers.
The Revolut mobile banking app allows users to easily buy, sell and exchange a range of digital assets like Bitcoin, Ethereum and more directly from their smartphones. What’s more, Revolut has recently enabled a staking feature for Ether, Cardano, Polkadot, and Tezo, further incentivising customers to give crypto a try. So, while most UK banks remain reluctant to crypto, Revolut is going in the opposite direction, smoothing the path to crypto adoption.
HSBC
HSBC is one of the banks that don’t seem as eager as Revolut to fully embrace digital currencies at the moment. The bank imposed new rules, prohibiting customers from purchasing digital currencies from exchange platforms with their credit cards.
However, customers are allowed to buy cryptocurrency with their debit card, as long as the transactions are facilitated by select regulated platforms such as Binance, Uphold or Bybit. To clarify their stance on crypto, HSBC has also announced that they have no intention to offer Bitcoin as an asset to their clients, going as far as restricting customers from acquiring stocks tied to virtual currencies.
Nationwide
Nationwide has taken a similar approach recently, implementing restrictions regarding the purchase of digital currencies. According to their official statement, the British lender decided to impose daily transaction limits on debit card purchases for crypto assets. There is a £5,000 daily limit for Adult Current Accounts and a £100 for FlexOne accounts, while payments to crypto exchanges using a Nationwide credit card are completely prohibited. The Bank explained its decision by citing regulatory risks associated with crypto investments, as highlighted by the Financial Conduct Authority (FCA).
Lloyds
Lloyd offers customers a little more freedom when it comes to crypto purchases. There are no policies that forbid clients from buying or selling digital assets as long as they use their debit cards and these transactions take place via FCA-regulated exchanges or brokers.
However, there is a restriction on credit cards which cannot be used to purchase Bitcoin and other crypto. This ban dates back to 2018, making Lloyds one of the first UK banks to crack down on crypto purchases with credit cards.
NatWest
NatWest has adopted rather harsh measures regarding crypto. In 2021, imposed drastic limits on the use of digital currencies, refusing to serve business customers who deal in crypto. This means that exchange platforms and firms that provide crypto products or services are not able to open a bank account with
However, this doesn’t mean that the bank is completely against crypto payments. Under the current policies, customers are allowed to transact digital assets from exchanges that are generally regarded as safer. There are also limits on how much customers can spend on crypto purchases which stands at £1,000 daily or £5,000 over a 30-day period.
Barclays
Barclays is one of the banks that has expressed its reluctance toward crypto purchases in a more subtle way. While they don’t forbid their customers from buying or selling digital currencies, they do restrict these types of transactions on their online banking platform. Clients are free to use their
Barclays bank account to purchase crypto from FCA-licensed exchanges. The bank imposed these regulations after the FCA warned consumers against the risk associated with using different crypto exchanges.
Santander
Santander UK is also capping payments to crypto exchanges, imposing a £1,000 limit per transaction and a 30-day limit of £3,000 for payments made to crypto exchanges using mobile or online banking.
Some customers have also reported having their bank accounts blocked after conducting transactions on crypto exchanges.
