article Locked Out of Crypto: UK Banks Reportedly Block or Delay 40% of Transfers to Exchanges

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What the survey says

A fresh survey from the UK Cryptoasset Business Council (UKCBC) suggests that moving money between UK bank accounts and crypto exchanges has become increasingly difficult — even when customers are using regulated platforms.

The report, titled “Locked Out: Debanking the UK’s Digital Asset Economy,” is based on feedback from 10 of the UK’s largest centralized exchanges. Together, these firms serve millions of UK users and have processed hundreds of billions of pounds in transaction volume. The idea behind the survey is simple: replace “everyone says it’s happening” with real numbers and show how bank controls are shaping the sector.

UKCBC argues that these restrictions are doing more than annoying customers — they may be slowing growth, pushing activity overseas, and weakening the UK’s ambition to become a major digital assets hub.

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“How hard is it to move money?”

Based on the exchanges’ internal data, UKCBC estimates that around 40% of transactions to crypto exchanges are being blocked or delayed by certain banks.

The survey also found:

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  8 out of 10 exchanges noticed an increase over the last 12 months in customers facing blocked or limited transfers

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  None of the exchanges reported a decrease

Simon Jennings, executive director of UKCBC, acknowledged that fraud prevention is a real issue — but added that many in the industry worry banks are using “compliance posture” as a convenient reason to hold back the sector’s development.

One UK-founded exchange reportedly saw close to £1 billion in declined UK transactions over the past year, driven by bank-side rejections of card payments and open-banking transfers.

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A broad pattern across banks (not just one provider)

The survey claims the trend affects a wide range of institutions:

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  Many high-street banks are said to enforce strict limits or outright blocks on:

  • bank transfers to exchanges

  • card payments to exchanges

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  Some challenger banks reportedly allow payments — but with tight caps or 30-day restrictions

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Blanket rules + poor transparency

UKCBC’s biggest complaint isn’t only the restrictions — it’s how they’re applied.

According to the report:

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  Most major UK banks and payment providers are using blanket limits or total blocks

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  These controls often don’t clearly distinguish between:

  • FCA-registered UK businesses

  • higher-risk or unregulated platforms

Exchanges also described the restrictions as inconsistent — including cases where controls hit FCA-registered firms, which they argue should be treated differently under a risk-based approach.

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“We get blocked, but we don’t get told why”

One of the sharpest points in the report: 100% of surveyed exchanges said banks provide no clear explanations for blocks or account restrictions — leaving both companies and customers guessing.

And the impact on customers is real:

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  One exchange said 60% of customers expressed anger about the friction

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  Another called bank limits and bans the single biggest barrier to launching or scaling new crypto products in the UK

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UKCBC’s recommendations

UKCBC says this goes beyond inconvenience — and frames it as an anti-competitive “debanking” problem that could push innovation elsewhere.

The report recommends:

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  Government and the FCA should clearly state that blanket bans are not acceptable

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  Banks should adopt more granular, evidence-based risk frameworks

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  FCA registration should carry meaningful weight, reducing unnecessary blocks and friction for registered UK firms

Jennings said that constructive dialogue is the necessary first step — but claimed banks have so far not engaged meaningfully, and have been unwilling to share data on fraud levels. In his view, if the UK wants to compete globally, the current situation can’t remain the norm.

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Extra practical notes (useful if you’re in the UK)

If you’re a UK user trying to fund an exchange account, these steps often reduce headaches (without trying to “game the system”):

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  Keep your KYC up to date on the exchange

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  Use your own bank account only (avoid third-party transfers)

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  Split large deposits into smaller ones if your bank has strict caps

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  Save records of deposits/withdrawals in case your bank requests proof of source-of-funds

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  Enable strong security (2FA), because banks are especially cautious when fraud signals appear

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  If a transfer is blocked repeatedly, contact your bank and ask what policy triggered it (sometimes they’ll clarify the allowed rails/limits)