Binance suspends AUD bank transfers in Australia
Binance Australia announced Thursday that it will no longer support Australian Dollar (AUD) bank transfers through PayID — a popular instant bank transfer system in Australia. The exchange cited its third-party payment service provider as the reason for this change and assured users that it is actively seeking an alternative solution.
Despite the removal of AUD bank transfers, Australian users can still engage in cryptocurrency transactions using their credit or debit cards on the Binance platform. Additionally, Binance’s peer-to-peer (P2P) marketplace remains operational without any disruption.
This latest setback comes after Westpac implemented a ban on its customers engaging in transactions with Binance, coinciding with the exchange’s loss of authorization to accept PayID funds transfers from Australian clients. Cuscal, the payment processor’s partner bank, also said that Binance failed to meet its strict compliance requirements in an effort to reduce scams and frauds.
“Cuscal has strict due diligence, onboarding and compliance requirements for our clients and any of their customers and/or merchants… Cuscal has, and will continue to, terminate any clients or their customers and/or merchants that do not meet our strict requirements,” a company spokesperson told the Sydney Morning Herald.
Binance is currently engaged in a battle to preserve its banking services within Australia, while simultaneously defending itself against allegations of impropriety in attracting customers and facilitating money laundering activities abroad.
Fellow Binancians,
We regret to inform you that with immediate effect we are unable to facilitate PayID AUD deposits for Binance users due to a decision made by our third party payment service provider. We understand from our third party payment service provider that Bank…
— Binance Australia (@Binance_AUS) May 18, 2023
This development is in line with the ongoing challenges faced by cryptocurrency exchanges in maintaining fiat on-ramps, which allow users to convert fiat money into cryptocurrencies. Binance Australia’s sudden disruption reflects the complexities involved in providing seamless fiat-to-crypto conversion services.
Earlier in April, Australian corporate regulator canceled Binance Australia’s derivatives license at the world’s largest cryptocurrency exchange’s own request. The move came amid debate and controversy around Binance Australia after it closed derivatives positions of some users. The crypto exchange stated that it had incorrectly classified 500 Australian users as “wholesale investors.”
Meanwhile, ASIC has been conducting a “targeted review” of Binance financial services business in the country. As part of the review, the watchdog has been looking into Binance’s classification of retail and wholesale clients. The regulatory body has also expressed concern about Binance’s compliance with Australian Anti-Money Laundering and Counter-Terrorism Financing (AML/CTF) laws.
Binance has faced its fair share of regulatory challenges in earlier times. In 2019, the ASIC warned local investors against Binance, stating that the exchange is operating in the country without proper licensing. Since then, Binance has taken steps to comply with Australian regulations, including registering with the Australian Transaction Reports and Analysis Centre (AUSTRAC), which is the country’s financial intelligence agency responsible for anti-money laundering and counter-terrorism financing.
