Banks - UK & Cryptocurrency
Every bank's motto is to help their customers, give great service and financial peace. With the rising popularity of cryptocurrency and their rising prices, are entering into the mainstream financial instituitions too. Not only are big banks looking at the applications of cryptos and the blockchain technology attached to it, but are also worrying about the impact the volatility could have on their customers. Banks are concerned for their customers but are also keen into reaping benefits of the new crypto world, makes me wonder.
There are different exchanges, methods to buy cryptocurrencies but some banks are more concerned about their customers using credit cards to buy cryptocurrencies as customers are maxing out their credit cards in hope that their prices will appreciate. Banks worry that the customers may be exposed to heavy losses and unable to repay their credit card debts,if the cryptocurrency prices do not rise as per expectation.
British banks are debating whether to ban their customers from buying cryptocurrencies using their credit cards after Lloyds Banking Group and Virgin Money said they had imposed such a ban. Lloyds bank to go ahead with this decision after bitcoin more than halved and follows similar bans from US lenders. The ban was first introduced in December for cardholders at MBNA, which Lloyds acquired last year. However Lloyds customers will be able to use their debit cards to buy cryptocurrencies.
According to Business Insider when asked all the UK's major high street banks for their positions on allowing customers to buy cryptocurrencies on credit. Here are few :
1. Lloyd : BANNED
A spokesman for Lloyds said the decision was made to "protect customers" from making unaffordable losses on Bitcoin.
2. Barclays : ALLOWED
Barclays says, We constantly review our protections for customers as a responsible bank and lender, and are keeping this matter under close review. At present UK customers can use both their Barclays debit card and Barclaycard credit card to purchase cryptocurrency legitimately.
3. Royal Bank of Scotland: ALLOWED
"We constantly review transactions but do currently accept credit card transactions for cryptocurrencies," a spokesperson for the RBS group told Business Insider.
4. TSB: ALLOWED
"We don’t block payments for customers wishing to purchase cryptocurrencies when they use a TSB credit card or debit card, under constant review.
5. Virgin Money: BANNED
"I can confirm that customers will no longer be able to use their Virgin Money credit card to purchase crypto-currencies," a spokesperson told Business Insider.
And there are many more banks like HSBC, Santander who are allowing their customers to purchase cryptocurrencies using their cards.
Banks are certainly divided on cryptocurrencies card purchases. I will be looking to learn and write views of banks in other countries too. Please do read my post and let me your thoughts.