India’s central bank RBI clarifies that there is no prohibition on banks from providing banking services to cryptocurrency companies or traders, in response to a right to information request.
The request was initially filed by cofounder of Indian cryptocurrency exchange Unocoin, Harish BV.
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
In 2018, the RBI released a statement restricting all regulated entities including banks from dealing with any organization or individual traders in transacting cryptocurrencies.
After the ban, many companies and traders received warning statements from their respective banks. The statement prevented the use of cryptocurrency activities or have they will have their accounts suspended.
In March 2019, things took a different turn when the Supreme Court lifted RBI’s ban on financial entities from dealing with crypto-related customers.
However, there were still uncertainties regarding whether banks could support accounts for such customers. Some banks were reportedly still refusing services to crypto businesses.
bitcoin: RBI says no curbs in providing bank accounts to crypto traders – The Economic Times https://t.co/zzOUxLmKIy via @economictimes — Harish BV (@bvharish) May 26, 2020
Harish BV filed an information request on April 25 to clarify traders’ concerns as to why banking portals still prohibited transactions in virtual currencies,
In response, the RBI wrote:
“as on date, no such prohibition exists.”
Harish BV says that now that the RBI’s stance is clear. The blockchain and cryptocurrency industry can flourish in India, opening digital assets to 1.35 billion Indians:
“After Supreme Court scrapping RBI’s Ban on crypto and RTI’s reply from RBI, it is clear that there is no need for any blockchain or crypto company to register out of India.”