National Australia Bank (NAB) and Westpac, two of Australia’s major lenders, denied on Thursday that they are stifling competition by refusing to do business with cryptocurrency exchanges.
Due to the high risks, many of Australia’s top financial institutions have avoided the sector, despite its massive growth in the last year.
Similarly, the Australian stock market ASX Ltd does not accept cryptocurrency-related listings, prompting some companies to seek public listings elsewhere, such as on the Nasdaq.
“It’s one of the developing problems we’re looking at – what should our engagement with cryptocurrencies be, if at all,” NAB Chief Executive Ross McEwan said at a monthly parliamentary hearing.
According to McEwan, the bank did not have a policy rejecting crypto-related customers, but it did not serve any of them and would only do so if it was lucrative and the risks were acceptable.
“We must consider where cryptocurrencies will go, as well as the reserve bank and regulators. And what is the danger of interacting with bitcoin suppliers inside the bank?”
The anonymity of cryptocurrencies makes meeting the bank’s anti-money laundering and counter-terrorism funding standards “extremely difficult,” according to Peter King, the chief executive of Westpac, the country’s second-largest lender.
Exchanges of digital currencies in your area Bitcoin Babe Pty Ltd and Aus Merchant Pty Ltd told a Senate committee looking into ways to regulate the industry on Wednesday that they would not do business with any of the Big Four banks.
Nium, a Singapore-based payments and remittances business, claimed on Wednesday that Australia was the only nation out of 40 where it operates where it had been “de-banked.”
“Today, fintechs are always one choice away from the banks closing their doors,” said Michael Minassian, Nium APAC head of consumer. “It’s past time to bring this anti-competitive conduct into the light it deserves.”