The NPCI has left it up to banks to decide whether or not to block cryptocurrency trades.
The National Payments and Clearing Corporation (NPCI) has left it up to banks and their risk and enforcement departments to decide whether or not to enable customers to make and receive payments from cryptocurrency exchanges.
Some Indian banks have instructed payment gateway operators to block merchants who buy or sell cryptocurrencies from using the bank’s net banking services.
The Supreme Court of India reversed the Reserve Bank of India’s 2018 banking ban on cryptocurrency in March of last year.
The National Payments Corporation of India (NPCI), a retail payments umbrella organization, has declined to block fund movements for crypto trades, instead leaving the decision to each bank’s risk and enforcement team. This comes at a time when certain cryptocurrency exchanges and investments are being blocked by banks.
“If NPCI had taken a centralised decision to prohibit the use of UPI and RuPay cards for crypto investments, it would have extended universally to all banks, leaving investors with less payment choices. Customers of banks that have disabled crypto cannot use UPI, net banking, or cards in any case.
However, trades continue to take place since many banks continue to encourage them. It’s uncertain how long they’ll keep doing it,” an industry source told ET, which broke the news first.
Crypto Confusion In India
The NPCI’s stance is important because some Indian banks have instructed payment gateway operators to block merchants who buy or sell cryptocurrencies from using their net banking services.
Nischal Shetty, cofounder and CEO of Mumbai-based cryptocurrency exchange WazirX, recently commented on the progress. “In India’s banking sector, confusion is causing 1.5 CRORE Indians to lose money in cryptocurrency.
The RBI crypto circular of 2018 has been declared invalid by the Supreme Court of India. “Banks in India continue to refuse banking based on the circular,” he wrote on Twitter on May 4. Source Inc42