Australia Addresses De-Banking Challenges
Governments and banks posed significant barriers to cryptocurrency in 2023. Some of the world’s top banks have been vocal in their opposition to the on-ramping and off-ramping of crypto firms.
The Treasury published its responses to take action on de-banking industries such as financial technology, digital currency exchange, and remittance service providers.
De-banking is defined as a situation in which a bank rejects to provide services to customers owing to risk reasons.
Following consultation with industry stakeholders, the Council of Financial Regulators made four recommendations to the government.
- Data Collection
- Transparency and Fairness measures.
- Guidance by specified banks.
- Capability uplift.
Banks should keep records of all de-banking transactions. They must also preserve transparency and fairness when informing their clients about the reasons for de-banking. Banks should also issue a 30-day notice before discontinuing their services.
Furthermore, before de-banking crypto exchanges, the Australian government expects banks to give instructions.
(With inputs from Shikha Singh)
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