Crypto Unbanking Could Drive Industry Underground: Australian Treasury
The Australian government is addressing risks of cutting banking services to crypto exchanges amid a wave of banks restricting some services due to scams.
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The growing trend of banks reducing their services to cryptocurrency companies in Australia could have undesirable consequences, such as making the industry less transparent, according to the country's Treasury Department.
On June 28, the Australian Department of Treasury released an official statement on potential policy responses to debanking in Australia. Unbanking occurs when a bank refuses to provide services to a customer, citing issues such as anti-money laundering (AML), compliance with sanctions, reputational risk considerations and others, noted authority.
According to the Treasury, there is a clear lack of data on unbanking practices in Australia, which makes it difficult to design effective policy responses. "The government recognizes the importance of insightful data to monitor any potential policy response to debanking," the statement said. The authority added:
“The government recognizes the seriousness of debanking and understands that inaction on the issue will stifle competition and innovation in the financial services industry and could drive businesses underground and operate cash-only.”
Among four published policy responses on unbanking, the Treasury mentioned digital currency exchanges. The authority specifically advised the four major Australian banks – Commonwealth Bank of Australia (CBA), Westpac, ANZ Group and National Australia Bank – to issue guidelines for crypto exchanges.
The Treasury stressed that it has encouraged banks to publish data on their requirements and the risk tolerance of crypto service providers, the document states.
“The government expects banks to clearly and proactively communicate their requirements to existing and potential customers before refusing or withdrawing banking services,” the Treasury wrote. The State will also work closely with regulators, banks and relevant sectors to ensure that...
The Australian government is addressing risks of cutting banking services to crypto exchanges amid a wave of banks restricting some services due to scams.
News
Join us on social networks
The growing trend of banks reducing their services to cryptocurrency companies in Australia could have undesirable consequences, such as making the industry less transparent, according to the country's Treasury Department.
On June 28, the Australian Department of Treasury released an official statement on potential policy responses to debanking in Australia. Unbanking occurs when a bank refuses to provide services to a customer, citing issues such as anti-money laundering (AML), compliance with sanctions, reputational risk considerations and others, noted authority.
According to the Treasury, there is a clear lack of data on unbanking practices in Australia, which makes it difficult to design effective policy responses. "The government recognizes the importance of insightful data to monitor any potential policy response to debanking," the statement said. The authority added:
“The government recognizes the seriousness of debanking and understands that inaction on the issue will stifle competition and innovation in the financial services industry and could drive businesses underground and operate cash-only.”
Among four published policy responses on unbanking, the Treasury mentioned digital currency exchanges. The authority specifically advised the four major Australian banks – Commonwealth Bank of Australia (CBA), Westpac, ANZ Group and National Australia Bank – to issue guidelines for crypto exchanges.
The Treasury stressed that it has encouraged banks to publish data on their requirements and the risk tolerance of crypto service providers, the document states.
“The government expects banks to clearly and proactively communicate their requirements to existing and potential customers before refusing or withdrawing banking services,” the Treasury wrote. The State will also work closely with regulators, banks and relevant sectors to ensure that...
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