UK lawmakers open inquiry into crypto firms’ bank access

UK lawmakers have opened a parliamentary inquiry into why crypto and digital asset businesses struggle to get basic banking services. For everyday investors, the issue goes beyond industry complaints: bank transfer blocks can affect how easily people move money to crypto platforms, while account restrictions can shape which firms can operate in the UK.

The Crypto and Digital Assets All-Party Parliamentary Group, or APPG, said it will examine access to banking for the UK’s crypto sector. An APPG is a cross-party group of MPs and peers that studies policy issues, though it is not a government department.

The group is co-chaired by Lord Vaizey of Didcot, a former digital economy minister, and Labour MP Gurinder Singh Josan. According to the APPG, the inquiry will look at why digital asset firms have difficulty opening and maintaining bank accounts, and why banks restrict some payments linked to crypto.

What the inquiry will examine

The APPG said the review comes shortly after the UK finalized a new regulatory framework for crypto. The group said it wants to test whether banking barriers could weaken the government’s stated goal of making the country a “global leader in digital assets.”

The inquiry will cover account access, banking services and related services including insurance, according to the APPG. It will also look at transfer limits and payment blocks used by UK banks, and whether those restrictions are proportionate.

In plain English, a payment block means a bank stops a customer from sending money to a crypto exchange. A transfer limit means the bank allows the payment, but caps the amount. Banks often frame these controls around risk, while crypto firms argue broad restrictions can cut off legitimate businesses and customers.

The APPG said UK crypto businesses have complained for years that they cannot reliably open or keep bank accounts. It also named HSBC, Nationwide, NatWest, Santander and Starling Bank among UK banks that have restricted crypto-related payments.

Josan and Vaizey said in a joint statement that access to banking is essential for legitimate businesses and that unnecessary barriers can hold back growth, investment and innovation. They said the period before the UK’s crypto regime takes effect is the right time to examine whether remaining obstacles could hurt the country’s digital asset plans.

Debanking pressure

The inquiry also lands against a backdrop of wider concern over “debanking,” a term used when a person or business is denied banking services or loses access to them. In crypto, that can mean a firm cannot get an operating account, or a consumer cannot send funds from a bank to an exchange.

Research published in January by the UK Cryptoasset Business Council found that UK banks were blocking or delaying an estimated 40% of attempted transfers to crypto exchanges. The APPG is now set to assess how that kind of restriction affects consumers, competition and innovation.

The review does not, by itself, change banking rules. It signals that lawmakers are paying closer attention to the gap between the UK’s crypto policy ambitions and the practical banking access needed for firms and customers to use regulated digital asset services.

This story draws on original reporting from Decrypt.