For Preventing Crypto Scams, UK’s Natwest Bank Adopts ‘Payment Restriction’ Policy
UK’s Natwest Group Takes Measures for Preventing Crypto Scams
Natwest Group is a British chartered bank that is also headquartered in the UK. Natwest is amongst the couple of financial institutions in the UK which are also engaged with cryptocurrencies.
Despite the crypto market crisis which commenced after November 2021, Natwest continued to lend support to cryptocurrencies. The firm has been very supportive of the entire crypto industry no matter the situation.
However, considering the banking sector crisis existing in the US, Natwest has also grown concerned.
As per the 14th March 2023’s announcement of Natwest, the bank has taken measures for preventing crypto scams.
It is also trying its best to save itself from regulatory scrutiny because the regulators are going after all major crypto-pro banks.
Therefore, it is important for the bank to ensure that it clears its positions so it can continue operating without facing any troubles. It has to clear its image and for this purpose, it has to ensure it complies with all the policies to stop crypto scams.
In this context, Natwest has adopted a policy that provides for ‘crypto payment restrictions’.
Under the newly implemented policy, crypto exchanges in the UK would be entitled to exchange GBP 1,000 only per day.
This means that exchanges can only transact $1,215 worth of cryptocurrencies through Natwest in a day.
Natwest has further clarified in the policy that the maximum monthly limit would not exceed GBP 5,000 (i.e. $6,077).
Reasons behind Natwest Adopting the Policy
Like in many parts of the world, even the UK’s banking sector is fearing the circumstances prevailing in the US banking sector.
Silicon Valley Bank (SVB) which was a US chartered bank has crashed recently. The crashed bank also took away with it the subsidiary it had established in the UK called the ‘Silicon Valley Bank UK Ltd.’.
Furthermore, two more banks in the US also have collapsed which include the banks such as Signature and Silvergate.
Both of these two banks along with SVB were actively involved in cryptocurrencies. Signature Bank’s crypto deposits for instance were exceeding 60% of the bank’s usual deposits.
However, Signature, SVB, and Silvergate have all fallen while the management control of SVB has been taken over by the regulator.
Acknowledging these factors, Natwest has decided to restrict its exposure to cryptocurrencies by capping crypto payment limits.
The ratio of Crypto Scams in the UK
Like in the rest of the world, the UK is also struggling in containing the instances of crypto scams. According to Natwest, crypto scams are accountable for causing a loss exceeding $399 Million to UK-based consumers per year.
It has been observed by Natwest that British consumers who are in the age group of 35 to 40 are at high risk against crypto scams.
The bank said in Tuesday’s press release that several platforms in the UK are offering fake investment opportunities in digital currencies.
It further noted that even social media platforms have been used to promote such fraudulent investment schemes in the UK.
The bank warned that consumers shouldn’t approach such schemes as they sponsor fraudulent sales and buying of digital currencies.
Natwest explained that cybercriminals have been pursuing their agenda by promoting the idea of a ‘cost of living crisis’.
Under this façade, they have been enticing potential investors and then looting their money without their knowledge, stressed Natwest.
Advice Offered by Natwest
The bank then went on to render advice to the crypto-interested UK-based consumers.
Natwest suggested that a crypto owner must always be in complete command and control of his or her digital wallet. The access and possession of such wallets shouldn’t be handed over to anyone in any circumstances.
In the end, Natwest warned that the number of crypto scams is rapidly increasing in the UK on an alarming level.
Consumers need to be careful because criminals are developing crypto exchanges for committing their crimes, warned Natwest.