The South African retail bank Capitec has blocked electronic fund transfers (EFTs) to crypto exchanges to protect customers from fraud.
The restriction comes after the announcement that the Capitec app interacts with the Fraud Center in real-time. This latest interaction will alert customers and restrict payment when beneficiaries report fraudulent activities.
Crypto Community Questions Bank’s Action
Carel de Villiers, Shiftly CEO, and co-founder experienced the restriction and was among the first to raise the alarm about the issue on his X handle. He expressed difficulty accessing his VALR account, a crypto exchange platform.
Hey @CapitecBankSA why am I not allowed to fund my @VALRdotcom account? Since when do you dictate how your customers are allowed to spend their money? pic.twitter.com/ufRBxHoJk5
— Carel de Villiers (@careldev) October 12, 2024
Following Carel de Villiers’ post on X, Farzem Ehsani, CEO and co-founder at VALR exchange, confirmed that the retail bank deliberately imposed the restriction, stating it was peculiar only to Capitec bank.
“Capitec Bank has informed us that it has decided to restrict its customers from sending funds to crypto exchanges. All other South African Banks allow you to fund your crypto asset account,” he said.
Capitec Responds
Speaking with MyBroadBand on the matter, a Capitec bank representative stated:
“Capitec is committed to protecting our clients from fraud, which is why we made the decision to block [electronic fund transfers] and immediate real-time clearing payments to crypto exchanges on our app and business web interface.”
Expressing Capitec’s concern about the safety and protection of customers’ funds, the SA bank affirms that it recognizes the growing interest in cryptocurrency and beckons users to adopt its Capitec Pay. This open banking system allows customers to make digital payments directly from their Capitec bank account as a safer alternative for crypto transactions.
On the bright side, other African countries increasingly embrace the crypto industry. For instance, Nigeria approved Quidax and Busha to operate as regulated crypto exchanges.
In another report, the Bank of Ghana revealed plans to launch a regulatory framework as a guardrail for crypto adoption in the country.
