While cryptocurrency is rapidly becoming more commonplace, with some countries even adopting it as a legal form of tender, in many other spheres it remains a suspicious mystery. South Africa has recently seen a local crypto exchange “lose” more than R50 billion worth of its customers’ money. It’s not really surprising then that FNB is taking a hard stance on the digital currency, and has begun blocking customers from buying cryptocurrency from overseas exchanges with their credit cards.
FNB’s cryptocurrency cut-down
The legality of crypto in SA has some caveats. See, unlike in China, it isn’t completely banned, but there are some relatively strict laws in place. According to the South African Reserve Bank, while you can legally purchase crypto assets locally and can also utilise things like your Foreign Investment Allowance to migrate your money for use in an offshore cryptocurrency exchange, it is illegal to transfer cryptocurrency assets out of the country. Doing so could cost you R250,000 and book you five years in prison.
Hence FNB’s decision to cut-off all overseas purchases of crypto assets using its credit cards.
According to MyBroadband, a reader explained to the news outlet that they tried to buy some cryptocurrency through Binance, an online international crypto exchange, and found themselves barred from the transaction.
This is accompanied by a message from FNB to its clients concerning the matter:
“As per the exchange control regulations, the purchase of cryptocurrency will no longer be allowed, and all international Debit and/or Credit Card transactions will be declined. Customers who wish to purchase International Cryptocurrency Assets may consider a SWIFT transaction via our Foreign Exchange Desk, in accordance with applicable Foreign Exchange Allowances.”
Which tracks with the South African Reserve Bank’s legislation, although FNB clients who know a thing or two about crypto laws have pointed out that the opening line is a bit misleading, seeming to imply that “the purchase of cryptocurrency” is illegal entirely. As mentioned earlier, “the purchase of cryptocurrency” overseas outside of Foreign Exchange allowances is illegal, but local purchase is still fine.