HSBC, Nationwide to restrict crypto purchases with credit cards

• HSBC Holdings and Nationwide Building Society in the UK have banned retail customers from purchasing crypto with credit cards.
• Both of these banks cited the warnings about crypto assets issued by the FCA in recent months as reasons for their actions.

HSBC Holdings and Nationwide Building Society in the United Kingdom have banned retail customers from purchasing cryptocurrency with credit cards. They are the latest in a growing line of banks in the UK to tighten restrictions on digital assets.

A recent Bloomberg report mentioned that the move has been made in response to warnings from UK regulators and scandals in the cryptocurrency industry.

Nationwide is reportedly imposing daily limits of 5,000 British pounds ($5,965) on debit-card purchases of cryptocurrency assets, while credit cards will no longer be accepted.

HSBC customers were barred from purchasing cryptocurrency with their credit cards last month. The bank cited the possibility of risks to customers as the reason for the step.

Both of these banks cited the warnings about crypto assets issued by the Financial Conduct Authority (FCA) in recent months as reasons for their actions.

Santander, Natwest Group, and Lloyds Banking Group are the other banks in the UK that have placed restrictions on crypto services.

Crypto services providers facing FCA’s heat

Authorities in the United Kingdom are cracking down on cryptocurrency companies.

The majority of the restrictions are aimed at the cryptocurrency exchange Binance. In August 2021, HSBC suspended credit card payments to Binance, citing concerns about the exchange’s regulatory status in the country.

In February, the regulatory body proposed a set of rules that could sentence executives of cryptocurrency firms to two years if they fail to meet certain promotion-related conditions. “Cryptoasset businesses marketing to UK consumers, including firms based overseas, must get ready for this regime,” stated the FCA.

According to the latest FCA order, all crypto exchange providers, including crypto ATM operators, must be registered and follow money laundering regulations.

A much-anticipated consultation paper for the UK’s upcoming crypto regulation was recently published by the Treasury. The proposals seek to position the UK’s financial services sector at the helm of cryptocurrency while avoiding strict control measures that have gained traction around the world.