Reserve Bank of India (RBI) Fights Against Crypto, Forces Customers to Reject Digital Assets

Reserve Bank of India (RBI) Fights Against Crypto, Forces Customers to Reject Digital Assets
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The Reserve Bank of India, one of the biggest in India according to report, is forcing customers to reject accepting cryptocurrency or doing any crypto related transactions. New customers are instructed during account opening to sign documents which state they would not deal with any crypto related transactions. Accounts of the already existing customers are closed immediately it is discovered they are dealing with any crypto related transaction.

In July 2018, the RBI issued a statement restricting all regulated entities in India including banks to stop dealing with individuals or businesses that trade in cryptocurrencies.

“Virtual Currencies (VCs), also variously referred to as cryptocurrencies and crypto assets, raise concerns of consumer protection, market integrity, and money laundering, among others… In view of the associated risks, it has been decided that, with immediate effect, entities regulated by RBI shall not deal with or provide services to any individual or business entities dealing with or settling VCs,” the RBI said in a statement today.

It further proposed to issue a circular to all the concerned bodies, aiming to protect the regulated entities from the risks associated with cryptocurrency.

Banks in India are now acting in accordance with this new ban on crypto, some of them have openly instructed customers not to deal with any transaction that is crypto related. Strictly adhering to RBI instructions against crypto, banks inform their customers via text messages to keep away from any crypto related transaction. Bank officials monitor transactions going through customers’ account, any account discovered to have crypto related transactions is closed without notice to customers.

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In some banks like Kotak Mahindra Bank, the instruction against dealing with crypto is clearly stated in their account opening documents, so customers would agree to it by signing as they fill the account opening forms. It states;

“I hereby declare that I will not deal with any transactions related to cryptocurrency including bitcoins. I also understand and agree that the bank reserves all right to close my account without further intimation in case I am found to undertake such transactions.”

Same way also, notice has been posted on strategic places like the ATM where the customers could easily see and read.

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