PNG Kina Bank suspends local SME account over crypto transactions
Media Statement – Howarig Traders
Bank South Pacific – BSP or BSP Financial Services Group and Kina Bank Limited or Kina Securities by now have successful blocked off all crypto transactions using bank issued Visa Debit Cards. BSP Bank via customer notice claimed due to the bank’s inability to authenticate crypto asset transactions, they have banned their BSP issued Visa Debit Cards for crypto type transactions in Papua New Guinea.
Soon after this notice, all BSP Visa cardholders ceased their accounts and left for Kina Bank when it started to talk about partnering with an international online banking service provider to bring the global forex market to PNG.
It was a collaboration between Kina Bank and Everest, an international internet solutions provider, Papua New Guineans would have access to a new platform for sending money overseas and trading in foreign currency using digital wallets if this partnership was fruitful.
According to a media statement by Kina Bank, customers would not require a Kina Bank account to use the new platform. Kina bank chief executive officer Greg Pawson said: “We want to make banking simple and easy for all customers, no matter who they bank with. “It’s one of many digital and mobile banking services we provide. “An added bonus is that we are working with the Bank of PNG on the regulatory requirements to provide customers with their own digital identity, ushering in a more digital future for everyone,” Pawson said.
Everest chief executive officer Bob Reid said: “We are thrilled to partner with Kina Bank to leapfrog antiquated means of moving money.
“By customizing elements of Everest’s global cloud bank platform, we remotely verify users’ identities digitally and empower them with encrypted accounts and digital transactions for easy, cost-effective money movement.”
Customers will be able to self-register using an app or online using their passport as ID, thanks to Everest's biometric identity and virtual account creation capabilities. They wouldn't have to go to a branch or submit any paperwork.
Customers may fund their digital wallets with their current online banking accounts and begin foreign currency operations once they have enrolled.
Everest runs its global cloud banking services on blockchain backend and deals with crypto currencies around the world. The crypto community in PNG grow rapidly and this was a positive step forward for crypto adaption in Papua New Guinea.
Kina Bank and Everest both said that they were dedicated to offering competitive foreign exchange rates and minimal transaction costs to guarantee that their clients could conduct cross-border transactions.
Kina was waiting for regulatory permission from the Bank of PNG before launching the service, which was scheduled to happen before the end of the year. The service is for everyone and a way forward to grow the economy.
Kina was allowing crypto transactions using Kina Bank issued Visa Debit cards with a daily limit of K2000.00 on every transaction per Visa Debit Card.
A few months later, while still waiting for BPNG to respond to Kina’s proposal on providing cloud bank banking services and digital wallets (crypto services) in partnership with Everest, Kina acted surprisingly to ban all crypto transactions on its Visa Cardholders.
All hopes were scattered, not only it banned the crypto transactions but Kina went further to conduct a due diligence on its customers’ bank accounts in pursuant to Anti-Money Laundering /Counter Terrorist Financing Act 2015.
In the course of conducting review on its customers against the above law, Kina Bank has suspended one of its local SME customer, Howarig Traders’ bank account due to crypto transactions. Howarig Traders is a local SME that provides coaching services to Papua New Guineans on digital assets, its valuable use and how to stake digital assets and conduct nationwide business seminars on the global forex market.
Kina Bank in a letter to Howarig Traders requested the SME to verify crypto transactions on its account, and was tasked to explain the relationship of its depositors and receipts of crypto transactions. Furthermore, Kina demanded Howarig Traders to give a brief on the purpose and use of the SME account, failure may result in the closer of the bank account.
Howarig Traders responded saying it had purchased crypto assets online using Kina Bank issued Visa Debit Card to store as digital assets on its digital wallets. Howarig Traders representative and bitcoin vendor Peter Kinjap said “we buy bitcoin and other crypto currencies to hold as digital assets as an option for saving money in the bank. We decided to buy crypto assets and store for later use. Digital assets are no different to physical assets and they are cashable”.
Mr. Kinjap said as a local SME, the revenue they get from their business seminars and sales of eBook manual on how to trade on the global forex market is converted into digital asset and saved their wallets.
Howarig Traders conducts nationwide seminars to educate interested PNGans and Pacific Islanders to create digital wallets and store digital assets on their smartphone, laptop or PC. Many PNGans bought digital assets assisted by Howarig Traders online and stored as digital assets (digital gold), something that is cashable at any time when they need it in the future.
Many PNGans who attended the seminar nationwide are looking to store digital assets as their savings on the phone than to open a savings bank account which the bank deducts fees almost every month.
Howarig Traders also advocate for financial inclusive for unbanked population whom see the mobile phone as a better option to store value than going to the bank.
“The crypto community in Papua New Guinea is growing rapidly and the Government needs to create laws to allow more PNGans to get into storing digital assets for future use,” Mr. Kinjap added.
“PNGans also trade on the global forex market as well as the crypto market. The Government must support PNGans, especially the growing number of school leavers from secondary and high schools to venture into the global forex market and crypto market,” Mr. Kinjap said.
There is no requirement, all you need is a smartphone with data and start trading a demo account on a broker platform and get a feel of it.
Howarig Traders conducts seminars nationwide targeting youths to explore the global forex market and venture into online opportunities.
They also educate PNGans and Pacific Islanders on potential risks about online and crypto scams. Those who attended the seminars can now be able avoid scams, as they know where to go and how to do it with minimal risks.
The seminar is highly recommended for those who wish to pursue online opportunities. A 50-page seminar eBook is provided to the participants explaining how the market operates and how PNGans can participate. Also educational videos and additional documents as complementary seminar materials.
Howarig Traders plans to further seek legal opinion if its Kina Bank account is permanently closed.
Meanwhile, the Government of PNG has been on blockchain, the technology drives bitcoin and other crypto currencies, since the APEC in 2018 promoting digital economic. Although, the bank of PNG launched a regulatory sandbox to test blockchain projects in PNG in September 2019, no commercial banks or financial institutes has taken the challenge for this innovation opportunity.
Interestingly, PNG’s mother country and closest neighbor Australia has adopted digital currency to overhaul its financial system and regulate it as a method of payment. Amongst many other avenues to test the adaption, the Commonwealth Bank is the first bank in Australia to allow crypto trading, allowing the first 10 popular crypto currencies to be traded with fiat currency.
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