PCI members to stay away from crypto exchanges

In another blow to crypto trading in the country, payment aggregators have decided to stay away from cryptocurrency exchanges and transactions in line with the concerns raised by the Reserve Bank of India.

Vishwas Patel, Chairman, Payments Council of India and Executive Director, Infibeam Avenues, said members of PCI will avoid working with cryptocurrency exchanges due to concerns of the RBI on the issue.

“Payment aggregators, networks and banks are licensed by the RBI. Knowing the RBI’s concerns about cryptocurrencies and the fact that there is no underlying assets backing these crypto currencies’ valuations, all the networks, banks and payment aggregators in India are staying away from powering cryptocurrency exchanges, ”he told BusinessLineadding that none of the members of Payments Council of India are working with these exchanges and are supporting their transactions.

“Many exchanges put up pseudo companies and names to use payment services. However, it’s high time the Indian government clarifies its stand and brings out a clear, comprehensive legislation on the legality of cryptocurrencies and the rules governing exchanges, ”he further said.

His comments come even as cryptocurrency exchanges have been trying to smooth out payment issues. Many players have said they are in talks with banks and have been trying to ensure P2P transfers for investors trading on their platforms.

Other issues

Apart from tax issues, the sector has been facing payment challenges starting this month after crypto investors were no longer able to use UPI for payments.

Some exchanges have said that they continue to work with small and mid-size private sector lenders for deposits and payments. while some payment gateways also continue to process such transactions. However, investor sentiment has been impacted with most exchanges reporting a dip in trading volumes.

MobiKwik had earlier this month withdrawn support for cryptocurrency related transactions.

“Effective April 1, INR deposits via MobiKwik will be temporarily disabled until further notice. Meanwhile, we are working to bring more INR deposit options and request you to use net banking and P2P, ”WazirXCares had tweeted.

On April 7, National Payments Corporation of India had also clarified that it was not aware of any crypto exchange using UPI.

There has been no formal communication from NPCI to members on crypto transactions and industry source said it is unlikely that a formal circular would be issued on it.

Published on

April 25, 2022

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