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Kuda Bank is Threatening to Cancel Cryptocurrency-related Accounts

 


Customers of Kuda Bank have been informed that if their accounts are proven to be involved in cryptocurrency transactions, their accounts would be closed.

The bank indicated that it is unable to assist bitcoin transactions due to a policy violation by the Central Bank of Nigeria, which governs all financial institutions in Nigeria.

Kuda Bank's announcement comes after a slew of social media complaints concerning account closures. 

The position of Kuda Bank on cryptocurrencies.

Kuda Bank was the first Nigerian bank to partner with Binance, a famous cryptocurrency exchange, and it was an early proponent of cryptocurrency.

As a result of CBN's announcement, Kuda Bank notified customers of its new cryptocurrency position on February 12, 2021. 

The notification is contained the statement below; “In the light of the recent letters and statements issued by the Central Bank of Nigeria concerning transactions relating to cryptocurrency, please note that Kuda Microfinance Bank is not allowed to and does not deal in, or facilitate the trading of, any form of cryptocurrency.

“Consequently, we strongly advise that you do not use your Kuda account for cryptocurrency-related activities so you don’t get into trouble with the law.”

Kuda responds to charges of account closure. In response to recent complaints by its customers on social media platforms, the bank released a message to its customers reaffirming its commitment to abiding by the CBN's laws and regulations as it does its business in Nigeria.

According to a statement issued by Kuda Bank, the bank told customers that if it didn't take action against fraudulent conduct, the bank would be considered to violate the law.

Read Kuda's message below;

“Let’s be crystal clear: We are on your side. We are your bank. There should never be any doubt about this.

But as much as we are on your side, we are also a licensed financial institution and our banking license comes with regulations and rules that we must obey. 

If we disobey these regulations and rules, we will not be allowed to continue running a bank for you or anyone else. There will be no bank of the free if we break the law.

So when a Kuda customer uses their account in a way that breaks the law, we must do what the law demands. 

In some cases, this could be as simple as asking the customer to explain what they use their account for. This is part of a standard KYC (Know Your Customer) process for any financial institution.

In cases of clear fraud, the law demands that we report the customer to the appropriate authorities and close their account with us so that they won’t continue to defraud other people of their money with that account. 

Remember that it could be you being defrauded, and we must do everything in our power to prevent this from happening.

If we do not do what the law demands in these cases, we will also be considered to be breaking the law.

This is why, for example, we have advised everyone not to use their Kuda account for cryptocurrency transactions of any kind, otherwise we’ll be forced to close their account as demanded by regulations. As of today, licensed financial institutions like ours are prohibited from enabling cryptocurrency transactions and we are not allowed to ignore this prohibition. It is simply what the law demands.”

“Kuda bank does not close accounts for no cause. The CBN policy must have been broken by the accounts that were canceled.”

“The bank is losing money by not supporting cryptocurrencies, but we must obey the CBN guidelines.”

Kuda also mentioned that if an account was accidentally closed, it can be reactivated.

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