On 8 January 2019, a Twitter user “Indian CryptoGirl” tweeted a screenshot showing the terms and conditions of India’s second largest private bank based on market cap, Kotak Mahindra Bank.
According to the screenshot, the bank demands its users to declare that they will not be involved in any transactions related to cryptocurrencies including Bitcoin (BTC). Users are also required to agree that the bank has the right to close their accounts without providing any further information if they are caught involving themselves in crypto transactions.
A similar statement was also found to be shown on an ATM (Automated Teller Machine) screen according to a screenshot posted by another Twitter user. The ATM showed a warning stating that virtual currencies are considered illegal tender and are not protected nor provided regulatory permission in the country. Users were asked to refrain themselves from making any transactions using their accounts that involved the use of such currencies.
The 2 statements are seen to be in sync with the announcement made by India’s central banking institution, Reserve Bank of India (RBI), in April 2018. The bank prohibited all local banks from providing financial services to crypto-related parties.
The bank released a financial report earlier this month for the years 2017-2018. The report concluded that digital currencies have no risk of destabilizing the country’s economic conditions. However, there are still political opinions stating that the crypto market should be outright banned from the country. Local authorities also warn residents of the risks of investing in unauthorized or unregulated crypto schemes.
It is worth mentioning that Facebook established a blockchain group aimed to develop a stablecoin meant for Whatsapp users. The cryptocurrency was said to be targeted at the Indian remittances market, which has proved to be very significant as it contributed to 2.8% of the country’s GDP back in 2017. If the country ultimately decides to reject the use of crypto and criminalize it, the project may be forced to shut down or change its targeted audience and usage.