The banking institutions reaffirm that having cryptoactives is not illegal in India. However, they prevent users from using their services in digital asset transactions
Indian banks introduce new contract clauses in their banking services. This was made known to various users through social networks, who are annoyed by the strong measures that banks are taking with respect to transactions that link their accounts with cryptocurrencies. Financial institutions say they are forced to accept the measure.
Some clients of the main banks of the country used the social network Twitter to denounce what they classified as abuses. Through photographs, the people who complained show what the prohibition clause says: “By means of this, I declare that I will not carry out any transaction associated with cryptocurrencies, including bitcoins. I also understand and accept that the bank reserves the right to close my account without offering further details, in case financial transactions for the digital currency trade are detected”.
The measures which seek to exacerbate restrictions on the part of banks, correspond to the ban imposed by the Central Bank of India a few months ago, which prohibited the country’s financial institutions from doing business with cryptocurrencies. On the other hand, users claim that such measures recently taken by banks curtail their free trade rights and endanger investors.
To open new accounts it is obligatory to accept the Indian Central Banks’ clause, so far. Otherwise, Indian people will not have access to the completion of the new account. This was commented by the user @Desicryptohodlr during an interview on the subject.
“Kotak Mahindra Bank is one of the largest financial institutions in the country. You have started to show this notice in the forms for the creation of new accounts since last month. This message appears as ‘a last clause’ before accessing banking services, which cannot be omitted or desactivated. Therefore, to create an account in the bank, it is mandatory to accept that message. Otherwise, you cannot use any online service associated with the bank”, he said.
In addition those affected ensure to receive, for some months, messages and emails from banking institutions, warning users that their accounts could be canceled instantly and without notice if they perform transactions with or related to cryptocurrencies. Their credit and debit cards will also be blocked if they are linked to purchases of
A representative of Instashift, an exchange with branch in India, explained that there is a fear on the part of banking institutions such as Kitak Mahindra Bank, since they are private institutions which operate in the country under licenses issued by the Central Bank and that act in a different way to the imposed prohibitions, they can represent the risk of the revocation of their licenses to operate.
These strong actions conducted by banks against customers that trade with cryptocurrencies represent a risk for businesses that have significant projects or ideas with cryptoactives. This is in addition to promoting an unstable trade environment with unreliable and insecure channels.
By María Rodríguez