Indian Bitcoin exchanges hit by banks’ withdrawal of services

Indian cryptocurrency exchanges are seeking a solution capable of enabling transactions with customers after a wave of banks and payment services cutting ties. Reuters.

In May, ForkLog reported that the country\’s central bank asked banks to sever ties with Bitcoin exchanges. Following this, the regulator urged affiliated institutions not to reference the repealed directive banning cryptocurrency operations.

In March 2020, India\’s Supreme Court overturned the RBI ban, allowing financial institutions to provide banking services to cryptocurrency firms.

“Banks are reluctant to cooperate. We discussed business with several payment services, but progress is slow.”, said Avinash Shekhar, co-founder of ZebPay.

The report notes that cryptocurrency platform users have faced withdrawal difficulties. In particular, services such as Razorpay, PayU, and BillDesk severed ties with exchanges, as they themselves rely heavily on banking institutions. And their smaller competitors could not cope with the surge in transactions.

“These are temporary measures, not a solution to the problem facing the industry.”, said Gaurav Dahake, CEO of Bitbns.

Chainalysis, in its 2020 report estimated there were 15 million crypto investors in India and $38.8 billion worth of the digital assets owned by them.

In June, Bloomberg reported plans by the Indian government to amend the bill banning cryptocurrencies and consider regulating this class of assets.

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