picture: Lev Dolgachov / 123rf
The largest banks in the country make no apologies for the strict controls and even bans on cryptocurrency users and traders.
New Zealand firm Easy Crypto recently accused some major banks of bullying behavior by refusing to complete transactions made for cryptocurrency companies such as Easy Crypto, or open a bank account for consumers and businesses dealing in digital currencies.
New Zealand’s five largest banks said they had reason to be cautious, in line with international and domestic risk warnings from regulators, including the Financial Markets Authority.
There have also been a number of large scams involving cryptocurrencies, such as the spectacular collapse of the multi-billion dollar US-based trading platform FTX, which sent shock waves through the crypto industry.
Banking policies regarding cryptocurrency transactions range from case to case by Kiwi Bank and ASB Bank.
“Ultimately, our goal is to keep our customers safe,” the ASB said in a statement.
“Banks operate in a complex regulatory environment (both globally and domestically) with anti-money laundering, sanctions and anti-terrorism financing laws, among the array of regulations we have to comply with.”
Westpac New Zealand was the most exposed when it came to cryptocurrency traders and their clients.
“At this point, we consider the cryptocurrency exchange industry to be too risky and will not routinely provide banking services to its participants,” Westback said.
ANZ was also risky, but it allowed customers to make some cryptocurrency transactions.
“If an ANZ personal customer wishes to purchase cryptocurrency using ANZ facilities (eg credit cards), they can do so as long as there are no commercial interests in the transaction (i.e. trading on behalf of someone else).”
BNZ said it was guided by the advice of regulators, but acknowledged that cryptocurrencies were gaining momentum and was monitoring developments.
“While we do not outright ban doing business with cryptocurrency-related businesses, we do classify cryptocurrencies as high risk in line with the advice of our regulators, and this puts an end to the entrapment of clients working in this sector that reflects this risk,” BNZ said.
New Zealand-owned Kiwibank is perhaps the most open center of the big banks.
“Each potential client will be assessed on a case-by-case basis and, as a minimum, evidence of compliance with AML/CFT obligations and sanctions will be required,” it said, referring to AML/CFT compliance.
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