Indian Banks Force Customers to Promise Not to Use Bitcoin

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Following new regulatory measures from the Reserve Bank of India prohibiting banks from providing services to cryptocurrency businesses, some Indian banks are taking drastic measures to discourage cryptocurrency adoption, reportedly requiring customers to sign contracts stating that they will not use cryptocurrencies of any kind as part of their new terms of service agreement.

Line in The Sand

The new measures effectively force customers to choose between banks and crypto, perhaps a difficult decision for many supporters of the fledgling cryptocurrency movement. While many hope to see cryptocurrency overtake traditional banking entirely, the infrastructure to do that simply isn’t there at the moment, and actions such as these carried out by banks on a large scale only make it more difficult to foster adoption – which, of course, is likely the point.

@DesiCryptoHodlr or “Indian Crypto Girl” on Twitter posted an image of the terms and conditions required by Kotak Mahindra Bank as an example of the new, strict measures being taken against cryptocurrency users.

Image courtesy: @DesiCryptoHodlr

The bank asks users to declare that they “will not deal with any transactions related to Crypto-currency including Bitcoins,” adding that the Bank reserves the right to close their account if they should breach the agreement.

Similar warnings are displayed on the bank’s ATM screens:

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. For any such transactions, the bank shall be acting in accordance with the regulatory guidelines which include closing your account without further intimation.

The bank claims to be acting in accordance with IRB regulations, and Crypto Girl stated on Twitter that this is just one of many banks forcing their customers to swear off crypto if they want banking services. Another Twitter user @IAmCryptoLegend commented in the thread to say that that banks are implementing similar measures in neighboring Pakistan.