Singapore Proposes Standards For Banks Dealing With Crypto Sector

• The banks will have the discretion to accept or reject crypto customers.
• MAS has joined the banks’ and police’s coordinated efforts to improve the screening process.

Authorities in Singapore are making a concerted effort to provide recommendations for banks on verifying cryptocurrency clients. Banks in the city-state have been collaborating with regulators over the last six months to develop industry-wide guidelines for vetting cryptocurrency consumers.

Singapore’s monetary authority, the Monetary Authority of Singapore (MAS), has joined the banks’ and police’s coordinated effort to improve the screening process for creating accounts for service providers dealing with any kind of digital asset.

Due Diligence and Risk Management

Companies providing payment services, including stablecoins, NFTs, and gaming credits, will be the topic of a separate, in-depth investigation. Due diligence and risk management are only two examples of topics that should have their own guides produced over the next two months.

The Singaporean central bank has verified that there are currently no regulations barring banks operating in the nation from doing business with enterprises managing cryptocurrencies or other types of digital assets.

The MAS spokesperson stated:

“As with any other current or prospective customer, banks are required to conduct customer due diligence measures to understand and manage the risk(s) posed by them. Banks make their own determination of whether to start or continue a banking relationship with a customer, balancing between commercial considerations and business risk tolerance.”

Even with such criteria in place, the banks will have the discretion to accept or reject these customers depending on their individual risk tolerances, according to persons familiar with the situation. Before, Singapore positioned itself as a vital financial center, drawing in crypto businesses seeking better conditions elsewhere.