Indian banks relax their stance on crypto trading

[ad_1]

Crypto investors in India may be able to use bank and debit cards to buy cryptocurrency again. Banks in India pulled services from crypto exchanges earlier this year, after an informal warning from the Reserve Bank of India (RBI). According to an Economic Times report, most customers have switched to using UPI to buy crypto, a channel outside the purview of banks. After months of uncertainty, Indian banks appear to be easing their stance on cryptocurrencies. According to a report by the Economic Times (ET), the country’s leading crypto exchange, WazirX, has listed internet banking payment options from reputable public and private banks in the country.

The development comes even as the Indian government has yet to decide how to govern cryptocurrencies in the country. According to Finance Minister Nirmala Sitharaman, India’s crypto bill is awaiting cabinet approval.

However, sources told Business Insider that a new committee could be formed to reformulate the bill. The government may relax its stance on cryptocurrencies amid the growing popularity of Tier II and Tier III cities. Banks allowing crypto transactions may not have entirely to do with becoming crypto-friendly, following in the government’s footsteps. According to the ET report, banks can only monitor transactions going through net banking or debit cards. Those who use the UPI (Unified Payments Interface) channels to buy cryptos are not the responsibility of the banks.

“Until recently, we did not authorize any transactions, and that is still our official position. But it is difficult to monitor so many transactions and some are successful, ”a banker told the publication.

Banks Open to Crypto Exchanges WazirX has listed major banks like Punjab National Bank, Union Bank of India and Industrial Development Bank of India (IDBI), Deutsche Bank, Federal Bank and many more ‘others as eligible for net banking.

This contrasts sharply with the month of May, when Indian banks ceased doing business with the stock exchanges after an informal communication from the country’s central bank, the Reserve Bank of India (RBI), warning them against any collaboration with these. companies. Many banks started shutting down crypto exchange accounts almost overnight, forcing many to stop receiving rupee deposits from their users.

Additionally, in a letter to users on May 31, a few Indian banks began warning their users against transactions with crypto companies. In its letter, HDFC Bank, India’s largest private sector bank, told clients that virtual currency transactions are not allowed, citing a 2018 letter from the RBI, which banned such transactions. This has led to widespread concerns about banks’ relationships with crypto exchanges.

Interestingly, the RBI letter cited by HDFC Bank and a few others, had been struck down by the Supreme Court of India (SC) in May 2020. The SC decision was praised by the crypto industry, which at his turn was able to take advantage of the bull run cryptocurrencies like Bitcoin and Ethereum suffered at the end of last year.

The RBI also issued a notice on May 31 revoking letters sent by these banks. Sharan Nair, Chief Business Officer (CBO) of CoinSwitch Kuber, one of India’s top four crypto exchanges, explained that the banks’ move comes after a circular from India’s central bank, the Reserve Bank of India (RBI).

Good news coming out of the RBI. Banks can no longer warn customers against # city cryptocurrency transactions… https://t.co/U7hdmO9A0O

– Sharan Nair (CoinSwitch Kuber) (@NairSharan) 1622470220000 That said, things are not yet fully back on track. “We offer several payment methods for Indian investors, such as UPI, Paytm UPI, IMPS, NEFT and RTGS. We also allow users to buy / sell cryptocurrency using their credit / debit cards, but we see most of these transactions being declined by credit / debit card providers, ”Jay Hao said. , CEO of the OKEx.com cryptocurrency exchange at ET. Alternatively, crypto exchanges in India can use multiple transaction channels including Net Banking, RTGS, and UPI. While banks can control net banking and RTGS channels, they have no control over UPI, which is a government-built digital payment platform. As long as banks allow crypto companies to hold bank accounts at their establishments, users can use UPI to deposit money on the exchanges.

For a more in-depth discussion, head over to Business Insider Cryptosphere – a forum where users can delve into all things crypto, engage in interesting discussions, and stay ahead of the curve.

SEE ALSO: Protests erupt over El Salvador’s planned adoption of bitcoin, protesters denounce token volatility and potential for corruption NFT-based game MIR4 is all the rage despite ‘mostly negative’ reviews

[ad_2]