India Major Bank To Close Accounts Using Crypto

| Publish date: 01/12/2019

In the latest cryptocurrency news, the Kotak Mahindra Bank, which is India’s second largest private sector bank by market cap, is reportedly requiring account holders to stop from dealings in digital currencies. The surprising news came after a claim was made by a user via Twitter that goes by the name of “Indian CryptoGirl” (@Desicryptohodlr).

Demanding Consent

According to the screenshot provided in the aforementioned user’s tweet, the country’s major bank makes explicit reference to the Reserve Bank of India’s (RBI) regulations in its apparent terms and conditions, all of which are meant specifically for account holders. Interestingly, it allegedly demands consent to the following:

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“Basis [sic] the regulations issued by RBI, 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.”

Prohibiting Crypto-Related Businesses

Sometime in April 2018, the India’s central bank RBI had prohibited all domestic banks from offering services and/or businesses that are crypto-related. Apparently, though, the legal status of these digital currencies themselves in the country remains greatly undefined; hence, the huge dilemma.

Following the tweet, a great number of Twitter users have simultaneously responded and voiced their concerns. Most also reported further unconfirmed details of the bank’s alleged anti-crypto warnings. One user, in particular, brought a screenshot that seems to highlight an ATM screen that belongs to an undisclosed bank. The only catch, however, is that it reproduces the exact wording of  Kotak Mahindra’s warning, which is placed against account closures without further intimation.

The ATM warning apparently further explicitly says that:

“Virtual currencies (VCs) are not legal tender and do not have any regulatory permission or protection in India. We request you not to make transactions involving any VCs from any of your account/s [sic.]”

Crypto in India Still A Concern

A particular Twitter user responded by simply volleying Indian citizens to make a national bank run, one that is particularly inspired by the recent calls to action from French grassroots political movement called the Gilets Jaunes (Yellow Vests).

To press time, Indian CryptoGirl has not responded to request for comment from the media.

As reported before, the status and future of digital assets in India remains highly contentious. After RBI’s infamous prohibition came into effect last July, both public and industry-led petitions have appealed to the courts on the grounds that the decision is unconstitutional.


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