What do you need to do if your bank does not allow you cryptocurrency purchases?
Some banks may not allow buying cryptocurrencies neither with your card nor with a wire transfer. We are going to examine the options you have in such cases below.
When your bank decides to disable the option to buy cryptocurrency, they may have different reasons for that: usually, they point to consumer protection, but it might be that some trades on the crypto-exchange was thought to have been a scam, so the transactions got cancelled.
Before you start to panic, make sure that it’s not just the card purchases that the bank disabled. For most exchange accounts, you can wire transfer the money as well, e.g. Coinbase and Bitpanda accept SEPA transfers as well. There are also differences when you are buying with a credit card or debit card — most international banks disable purchases made with credit cards, and, in turn, credit.
Let’s assume, however, that your bank does not allow you to pay by card nad you don’t have the option of transferring, either. What alternatives are there?
Go to an ATM and pay in cash
If you want to check out where you can find ATM-s that will sell you cryptocurrencies, visit the website coinatmradar.com.
In this case, you need to think of the ATM as a traditional currency exchange place which can handle crypto-wallets, too. You should have your phone with you, too: on the one hand, if you buy a larger sum, you will be asked for your phone number, on the other hand, you’ll need it to identify your own mobile wallet with its QR code. If you have no internet connection or your mobile wallet, you can create a paper wallet with the ATM. Depdending on the type of ATM, you can exchange multiple cryptocurrencies as well. For further information, check out the website of the companies that maintain these ATMs.
The process of the purchase goes something like this: you select purchase, put in the required cash, scan the QR code of your wallet. If you have a mobile wallet with an active internet connection, the Bitcoin value will immediately be displayed. In the case of a paper wallet, you can chack the content of your wallet at the end of the transaction on your computer.
ATMs are usually expensive, and, depending on the operator, they may charge you with a 3–6 percent transaction fee. Before you exchange any currencies, please make sure you are informed about these fees.
Using the ATMs is regarded to be safe; however, if you are a first time user, please read everything carefully. They are not any more complex to operate than a traditional ATM — during working hours, you have the option to call a support line as well.
Buy on LocalBitcoins
LocalBitcoins aims to bring sellers and buyers together using an easy-to-use web interface. Just like eBay, their services using a rating system based on reputation, so you can easily identify those who have a large traffic and can be considered trustworthy, based on feedback from buyers and sellers. Most clients prefer wire transfer, but you have a chance to arrange face-to-face meetings as well where you can follow through the transaction in cash. LocalBitcoins uses an escrow system, that increases security by locking the sellers Bitcoin until your transfer arrives. Since clients usually deal in large volumes through multiple accounts, look into all buyers and only do business with those whose ratings seem trustworthy to you. Additionally, BitQuick and Wall of Coins offer similar services to LocalBitcoins.
Buy in person
LocalBitcoins offer you to arrange face-to-face meetings, but you have a chance to do this through different Facebook groups as well. If you go with this option, always take your mobile wallet with you on a device that has active internet connection. This method is not recommended for beginners; if you decide to go face-to-face, make sure you do it in an open and public place.
Due to the development of financial technology (aka Fintech) in the last couple of years, there are services now that allow you to handle bitcoins as well. One such service is Revolut, which provides you with an account, a wallet and and internet-banking application as well — furthermore, you can even request a MasterCard debit card, too. With Revolut, you can exchange for free up until multiple thousands of Euros between different currencies for a 1.5% fee. One large disadvantage is that you cannot transfer to another wallet yet, only to a different Revolut account.
Revolut's crypto-services are only available to premium users as of yet. Just like all the other fintech companies, Revolut doesn't have a valid banking license as of yet, and your deposits are not protected by the regulations related to bank.