South Africa's Central Bank Approves of Local Banks Serving Crypto Clients

South African Reserve Bank (SARB) has directed financial institutions in the country to serve customers handling cryptocurrency transactions.

In a guideline, the bank stated that institutions should not impose an overall cryptocurrency ban but called for banks to conduct due diligence when dealing with such clients. 

This comes after some banks in the country resolved to close clients’ accounts associated with cryptocurrencies citing a lack of adequate regulations to govern the sector. 

"Banks may act as a conduit for funds linked to crypto asset service providers activity and may play a role in customers wishing to purchase crypto assets or receive pay-outs for the sale of crypto assets via fiat currency into their bank accounts. Banks must ensure that they maintain adequate records in respect of all customer transactions, including fiat-to-fiat, fiat-to-crypto and crypto-to-fiat transactions," SARB said. 

Furthermore, banks had shut down crypto-linked accounts due to greater risk exposure. However, SARB acknowledged that risks exist in the crypto market, but the financial institutions must conduct a comprehensive assessment. 

(Source: Finbold)