The Australian arm of international bank HSBC has informed customers that it has begun blocking customer payments to cryptocurrency exchanges as of July 24 local time. This makes it the latest major bank to shun the industry, citing scams.
“From 24 July 2024, HSBC will block payments from bank accounts and credit cards that we reasonably believe are being made to cryptocurrency exchanges, for your protection,” HSBC Australia said in a July 24 email to customers explaining its “new safety measures.”
“If you wish to make payments to cryptocurrency exchanges, you’ll need to make alternative arrangements.”
To support its decision, HSBC cited data from Australia’s competition and consumer regulator, which show that Australians lost up to $171 million in investment scams in 2023.
The bank apologized for the “inconvenient” change but stressed that its priority is ensuring customer money remains safe.
HSBC’s move comes a little over 12 months after Australia’s “Big 4” banks, Commonwealth Bank, National Australia Bank (NAB), Westpac and Australia and New Zealand Banking Group (ANZ) took similar action to restrict payments to cryptocurrency exchanges.
Australia’s Bendigo Bank followed suit soon after, citing the need to protect customers from investment scams.
Amy-Rose Goodey, managing director of the Digital Economy Council of Australia (DECA), told Cointelegraph they were not “pre-informed” of HSBC’s decision.
“The recent decision by HSBC to block all payments to cryptocurrency exchanges has reignited concerns about the ongoing challenges facing the relationship between Australian banks and the cryptocurrency sector,” said Goodey, adding the move isn’t isolated and reflected a “concerning trend” of restrictions that affect the digital currency community.
“It underscores the critical need for dialogue and improved regulatory frameworks that support innovation while addressing potential risks effectively.”
Related: Australia’s peak crypto lobby group drops ‘blockchain’ from name
Without dialogue, Goodey said more Australians will lose out on the “financial right” to participate in the growing digital economy.
Goodey added that by establishing “clear, fair and forward-thinking regulations,” banks and industry players will be better positioned to combat these scams without slowing innovation. She also added that the association has taken steps in the right direction since 2023. DECA was added to the advisory board of the National Anti-Scam Center.
HSBC said it would still accept customer payments coming from cryptocurrency exchanges and that banking would continue as normal.
HSBC Australia currently serves 1.5 million customers from 45 branches throughout the country.
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