Reserve Bank of India (RBI) has issued official guidance to banks. that India’s banking ban no longer applies Because the country’s supreme court was set a year ago, despite the ruling of the Supreme Court. But banks referred to the RBI circular on dealing with cryptocurrencies.
RBI tells banks to stop referencing circulars ‘Not Available Anymore’ In Cryptocurrency
The Reserve Bank of India (RBI) released the announcement on Monday. To clarify its position on cryptocurrencies, the announcement titled “Customer Due Diligence for Transactions in Virtual Currencies (VC)” is aimed at: All commercial banks and cooperatives payment bank Small financial banks, NBFCs and payment system providers.”
We have caught our attention through media reports that some regulated banks/agency have warned their clients against trading virtual currencies with reference to the RBI circular … dated April 6, 2018.
The April circular advised banks that they were banned from trading cryptocurrencies. However, the Supreme Court of India revoked this circular in March last year. This allows banks to return their services to crypto businesses. This includes cryptocurrency exchanges.
In its announcement on Monday, the RBI clarified: “Such references to the above circular by banks/regulated entities are disorganized. As this circular was blocked by the Hon’ble Supreme Court on 04 March 2020 on the Civil War Petition No.528 of 2018 (Internet and Mobile Association of India v. Reserve Bank of India),” further explains. :
Therefore, according to the order of the Honorable Supreme Court The circular is therefore no longer valid from the date of the Supreme Court’s judgment. Therefore, it cannot be referenced or quoted from.
The central bank added: “However, Banks and other entities mentioned above. May continue to perform customer due diligence processes in accordance with regulations governing standards for Know Your Customer (KYC), Anti-Money Laundering (AML), Fighting Terrorism Financing (CFT), and Burden. The duties of a regulated entity under the Anti-Money Laundering Act (PMLA), 2002, in addition to complying with the relevant requirements under the Foreign Exchange Management Act (FEMA) for foreign money transfers.”
Meanwhile, the banking restrictions were lifted in March last year. Some banks in India are reportedly still restricting crypto transactions. Some customers have reportedly received email notifications from their banks stating that they are not authorized to use their bank accounts or credit cards to complete crypto transactions.
Some media outlets reported that the RBI had asked banks to cut ties with crypto businesses and informal traders, however, the National Payments Corporation of India said it would not ban the transaction. cryptocurrency via UPI
meanwhile The Indian government is still working on the regulation of cryptocurrencies. A crypto bill should be introduced in Congress during the budget period. But that’s not the case. last month The media reported that the government plans to set up a panel of experts to work on cryptocurrency regulation.
What do you think about the RBI’s clarification to the bank about cryptocurrencies? Let us know in the comment section below.
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