Santander to block payments by UK banking customers to Binance

Santander joined Barclays as the latest British high street bank to block retail customers from sending money to Binance, following the UK financial watchdog’s warning about the international crypto exchange.

The bank notified customers that it would stop payments from their accounts to Binance “wherever possible” starting from Thursday, but would still allow them to withdraw cash from the exchange.

“Keeping our customers safe is a top priority, so we have decided to prevent payments to Binance following the FCA’s warning to consumers,” Santander said. “In recent months we have seen a large increase in UK customers becoming the victims of cryptocurrency fraud.” 

The decision severs another link between traditional financial institutions and the international crypto exchange, which has faced questions from regulators about its compliance standards.

Binance said it was “disappointed” by Santander’s decision and that it takes its compliance obligations and the security of its users’ money “very seriously”. 

In an open letter published on Wednesday, Binance CEO Changpeng Zhao said he viewed “more regulations [as] positive signs that an industry is maturing” and hoped to “reiterate our commitment to partner with regulators”.

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The exchange is also under pressure from authorities around the world over its sprawling crypto operations, including a criminal complaint in Thailand and regulatory scrutiny in Canada, Japan and the Cayman Islands.

Binance said on Tuesday that it would no longer be able to deposit funds through one of Europe’s main payments networks, the Single Euro Payments Area (Sepa), because of “events beyond our control”. Binance has also stopped providing sterling deposits through a big UK payments network, Faster Payments, that provides quick transfers between the country’s banks.

The Financial Conduct Authority (FCA) issued a formal consumer warning about Binance last month, banned it from regulated financial activities — such as arranging conventional investment deals — and said it was not authorised to conduct crypto operations in the UK.

Barclays stopped payments to Binance on Monday, citing the FCA’s warning. NatWest said last week it had blocked payments to “a small number of cryptocurrency asset firms where we have seen particularly significant levels of fraud-related harm for our customers” without naming Binance.

Customers at the bank have told the FT that they cannot send money to the exchange.