HSBC and Nationwide Follow Suit to Prohibit Crypto Credit Card Purchases: Bloomberg Report

Several other banks in the U.K. have also imposed limitations on their crypto services, including Santander, Natwest Group, and Lloyds Banking Group

By Shashank Bhardwaj

Published: Mar 3, 2023 11:23:08 AM IST

Updated: Mar 6, 2023 11:32:51 AM IST

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HSBC Holdings and Nationwide Building Society, two banks based in the United Kingdom, have decided to prohibit retail customers from purchasing crypto via credit cards. This move is in line with other banks in the country that have recently imposed stricter regulations on digital assets.

According to a Bloomberg report on March 2, the decision was prompted by warnings from U.K. regulators and the numerous controversies surrounding the crypto industry. To this end, Nationwide has set a daily limit of £5,000 ($5,965) on debit-card purchases of crypto, while credit cards will no longer be accepted for such transactions.

Last month, HSBC prevented its customers from using their credit cards to purchase crypto. According to an email seen by Bloomberg, HSBC justified this move by citing potential risks to customers.

Similarly, both HSBC and Nationwide Building Society have referred to warnings issued by the Financial Conduct Authority (FCA) regarding the potential dangers associated with crypto assets.

Several other banks in the U.K. have also imposed limitations on their crypto services, including Santander, Natwest Group, and Lloyds Banking Group. These restrictions mainly target the Binance crypto exchange.

HSBC, for instance, barred payments to Binance through credit cards in August 2021, citing concerns over the exchange's regulatory position in the country.

Regulators in the United Kingdom are taking a more stringent approach towards crypto companies.

In February, the Financial Conduct Authority (FCA) put forth a series of regulations that could result in crypto firm executives being sentenced to up to two years in jail if they fail to adhere to specific advertising criteria.

The FCA issued a statement urging crypto businesses, including those based outside the U.K., to prepare for these new regulations.

The United Kingdom recently released a consultation paper outlining the upcoming crypto regulations. The proposed regulations aim to position the U.K.'s financial services industry as a leading player in the crypto space while also avoiding the strict regulatory measures that have been implemented in other countries around the world.

The document covers several topics related to crypto assets, such as algorithmic stablecoins, non-fungible tokens, and initial coin offerings.

Shashank is the founder of yMedia. He ventured into crypto in 2013 and is an ETH maximalist. Twitter: @bhardwajshash