India’s central bank, the Reserve Bank of India, seems to finally be clarifying its stance on financial services for cryptocurrency-related businesses in the country. In response to a right to information request, the Reserve Bank of India clarified that there are no restrictions on banks preventing them from providing an account to cryptocurrency companies or traders. The RTI request was initially filed by Harish BV, a cofounder of local cryptocurrency exchange Unocoin.
Some banks reportedly refused to provide services to crypto businesses.
The Reserve Bank of India, back in 2018, had issued a notification to all banks in the country prohibiting them from providing services to crypto businesses in the country or any other crypto-related activities. After the ban, several companies and traders received warning statements from their respective banks, advising them to either stop their cryptocurrency activities or have their accounts suspended. But in March, the Supreme court of India declared RBI’s banking ban on crypto as unconstitutional and reversed the bank’s decision. However, even after the Supreme court’s decision, several banks in the country reportedly refused to provide services to crypto businesses, which prompted Unicoin cofounder to file the RTI.
An RTI was filed by @bvharish Co-founder of Unocoin.
Question: Does RBI prohibited any banks from providing the bank accounts to crypto exchanges or crypto traders ?
Answer from RBI: As on date no such prohibition exist.
Great, now you can show this RTI to your bank. 🚀🚀 pic.twitter.com/n5iqGCSQtd
— Crypto Kanoon (@cryptokanoon) May 24, 2020
The Indian government is yet to pass a bill regulating the crypto industry.
The Supreme court’s decision to declare RBI’s banking ban on crypto might have relieved the crypto industry in the country. But the crypto regulations in India are still in a grey zone. The lawmakers still have to pass a law setting rules and regulations for the crypto industry in India. Earlier, an inter-ministerial group had proposed a full ban on the crypto use in India, but the proposal is yet to come into the lower house of the parliament of India. Currently, all crypto exchanges based in India are allowed to carry out their businesses.