Commonwealth Bank of Australia Implements Restrictions on Payments to Crypto Exchanges

Citing concerns over potential scams, Commonwealth Bank (CBA), Australia’s largest bank, has announced its decision to either decline or temporarily hold specific payments to cryptocurrency exchanges. In the wake of two global exchanges facing a lawsuit from the US securities regulator, Commonwealth Bank’s decision to decline or temporarily hold certain payments to cryptocurrency exchanges comes into play.

This move follows closely on the heels of another major Australian bank, Westpac, imposing a ban on customer transactions with crypto exchange Binance. As of June 8th, Commonwealth Bank (CBA) has implemented new measures aimed at safeguarding customers from scam risks related to payments made to cryptocurrency exchanges. These measures include the bank’s decision to either decline or place a 24-hour hold on specific payments to such exchanges.

James Roberts, Commonwealth Bank General Manager of Group Fraud Management Services, said: “Consumer interest in cryptocurrencies has been increasing and unfortunately scammers globally are capitalizing on this trend and masquerading as legitimate investment opportunities or diverting funds into cryptocurrency exchanges. Customers who make payments to cryptocurrency exchanges are currently facing a significantly higher risk of potentially being scammed.”

Mitigating Scams and their Financial Impacts

As part of their statement, the bank also revealed their plans to introduce a monthly limit of $10,000 Australian dollars (US$6,650) for customers sending funds to crypto exchanges to purchase cryptocurrencies. This limit is expected to be implemented in the upcoming months. The bank stated that Given the escalating instances of scams leading to substantial customer losses, the implementation of 24-hour holds, declines, and limits on outbound payments to cryptocurrency exchanges aims to mitigate scams and their financial impact. 

The bank stated: “From today, CBA will decline or hold for 24 hours¹ certain payments to cryptocurrency exchanges. In the coming months, the Bank will also introduce $10,000 limits in a calendar month where the Bank can identify the customer payments are to exchanges for cryptocurrency purchases.”

These measures include offering their advanced NameCheck anti-fraud technology to external organizations involved in payment processing across Australia. CBA’s decision to extend this technology is part of a broader national initiative. The bank acknowledges that these measures will be continuously evaluated and their impact closely monitored. This represents a notable change for CBA, considering that only a year and a half ago, in November 2021, the bank had plans to launch crypto trading services for the extensive user base of its CommBank app.