Capitec, a prominent South African retail bank, has taken steps to block Electronic Funds Transfers (EFTs) and payments to cryptocurrency exchanges, citing anti-fraud measures. A spokesperson explained to MyBroadband, “Our goal is to protect clients from fraud, which is why we decided to block EFTs and real-time clearing payments to crypto exchanges on our app and business web interface.”
Farzam Ehsani, CEO of VALR, confirmed that Capitec has restricted its customers from sending funds to crypto exchanges. However, he noted that this restriction is unique to Capitec, as other South African banks still allow their clients to fund crypto asset accounts. Capitec’s users wanting to fund their VALR account can still use a South African credit card or an account from another bank.
Earlier in 2024, VALR gained approval from the South African Financial Services Conduct Authority to offer expanded exchange services, which has allowed it to explore additional product categories. This regulatory approval highlights the growing legitimacy of crypto services in South Africa, despite the Capitec’s recent actions.
Carel de Villiers, co-founder of Shiftly, shared his frustration on X (formerly Twitter) after attempting to fund his VALR account and receiving the error message, “Payments to this beneficiary are not allowed.” He noted that while the transaction works on the web, it is blocked on mobile.
In response to growing concerns, Capitec emphasized that clients can use the Capitec Pay system for secure transactions. The bank is also working with crypto exchanges to integrate Capitec Pay into their platforms. Additionally, it has introduced real-time interactions between its app and its Fraud Centre to block or warn users about suspicious accounts or beneficiaries flagged for fraud.
As South African interest in cryptocurrency grows, Capitec remains cautious, positioning its anti-fraud initiatives as necessary safeguards for its clients.
