Crypto exchanges in India are switching to facilitating user-to-user bank transfers and inward remittances to work around a withdrawal of support from the developer of the country’s ubiquitous UPI payments system, local media report.
See related article: Coinbase snafu sets the cat among the crypto pigeons in India
Fast facts
- Indian cryptocurrency exchanges are trying to allow users to directly transact with each other.
- Exchanges offering services to Indians now connect a buyer and seller with money transferring between their bank accounts instead of flowing through the exchange.
- Alternatively, buyers can deposit funds into a cryptocurrency exchange’s checking account and the exchange will hold it in escrow.
- These developments follow the withdrawal of support from the National Payments Corporation of India (NPCI), the developer of the country’s ubiquitous Unified Payments Interface (UPI) payments system.
- These moves are unlikely to pass muster with the Reserve Bank of India which has called for an outright ban on cryptocurrencies.
- The checking account of cryptocurrencies is typically in the name of a software solutions provider.
- Until recently, Indian cryptocurrency exchanges received or paid money through the account of a third-party payments operator.
- But such payment firms have withdrawn support.
- Exchanges say this isn’t the way to handle trades but for now this seems to be the only option, as technically there seems to be no violation of any regulation or law.
See related article: Who’ll blink first in India’s crypto stand-off?
