India’s ICICI Bank warns remittance users to steer away from Bitcoin

Published at: July 13, 2021

India’s stance on crypto adoption has been a gray area ever since the birth of Bitcoin (BTC). In what seems like another blow for the Indian crypto community, one of the biggest financial services, ICICI Bank, has warned users not to use their remittance services for transferring any form of crypto or digital currency.

In ICICI’s latest iteration of the Retail Outward Remittance Application form, the bank has clearly stated its intent to stop users from using the service for crypto transfers. Based on the Foreign Exchange Management Act (FEMA) 1999, the declaration states: 

“The above remittance is NOT for investment / purchase of Bitcoin/Cryptocurrencies/Virtual Currencies (such as Ethereum, Ripple, Litecoin, Dash, Peercoin, Dogecoin, Primecoin, Chinacoin, Ven, Bitcoin or any other virtual currency/cryptocurrency/bitcoin).”

The major banking institution has shared two more points that reiterate its anti-adoption stance, further warning users not to use its remittance service for investing in companies that deal with Bitcoin or any other crypto and digital currencies.

Users were also warned not to send any funds that may have been procured via crypto investments in the past. However, the Indian government has not yet shown resistance to blockchain-based financial applications.

ICICI’s move to use FEMA 1999 against crypto adoption is consistent with other banking players in the country ever since the Reserve Bank of India (RBI) announced to ban banks that do business with crypto-related firms back in April 2018.

Related: India Supreme Court Lifts RBI Ban on Banks Servicing Crypto Firms

Contrary to ICICI’s latest move to disregard crypto enthusiasts, the Supreme Court of India has contradicted the RBI’s ban on crypto-friendly banks. As a result of this confusion, India’s crypto investors continue to find loopholes in the system to grow their crypto portfolio.

While government officials continue to postpone the date of the inevitable, the evident lack of regulatory clarity on crypto investments has a direct impact on investors and the country’s fintech innovation. 

On the other end of the spectrum, India’s largest cryptocurrency exchange, Binance-owned WazirX, continues to see a rise in trade volumes and new users, owing to RBI’s clarification on the removal of the ban based on the Supreme Court’s verdict. 

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