Ukrainian banks to have tighter oversight of clients’ spending

Source: National Bank of Ukraine on Facebook

In a bid to tighten financial oversight, the National Bank of Ukraine has recommended on Monday that banks need to introduce limits for their clients in line with their declared income. This recommendation would require banks to set spending limits based on the income information provided by clients and apply these limits across all of the client’s bank accounts simultaneously.

Under the new guidelines, if a client’s card turnover exceeds their declared income, their account may be frozen until they provide an explanation for the source of the funds. The National Bank of Ukraine argues that the policy is to “increase control”over financial transactions and crack down on “tax evasion” schemes.

“We advise banks to coordinate through their association to ensure that income-based limits become the standard across the board, so clients can’t simply switch banks to avoid restrictions,” said NBU Deputy Governor Dmytro Oliinyk.

To further enhance monitoring, the National Bank will also set up a register of compromised cards that will help blacklist “unreliable sellers” over the next month.