Banks in India, including some of the country’s largest lenders, are notifying their customers not to engage in trading cryptocurrencies, adhering to a central bank rule from 2018 that bans them from dealing in cryptos — despite the fact the ban was overturned by the Supreme Court more than a year ago.

Fast Facts:

  • Customers of HDFC Bank, India’s biggest, have taken to social media to vent their frustration over the bank’s cautionary emails, as have users of credit card SBI Card, which has threatened to suspend or close the accounts of customers who engage in crypto transactions.
  • Other banks have asked their customers to complete declarations stating that they will not be involved in any crypto transactions.
  • The Reserve Bank of India banned banks from dealing in crypto in 2018, but the ban was set aside by the Supreme Court in March 2020, since which time the RBI has made no formal announcement on the status of the ban.
  • The Economic Times reported on Friday that crypto exchanges are planning to ask the top court for a directive on whether the RBI can demand that lenders cease to provide payment services to merchants involved in cryptocurrency trading.
  • India’s finance ministry is reportedly developing laws to govern cryptocurrencies, and just last week, HDFC Bank released a report saying that it was only a matter of time before Indian investors had legal access to cryptocurrency markets.