The State Bank of India (SBI) has reportedly blocked payments to cryptocurrency exchanges through its Unified Payments Interface (UPI). Payment processors have been instructed to disable the bank’s UPI for crypto merchants.
Payment processors instructed to disable SBI UPI for crypto companies
The State Bank of India, the country’s largest bank, has reportedly “blocked receiving funds from crypto exchanges on its UPI platform,” the Economic Times reported on Wednesday, citing payment industry sources.
Unified Payments Interface (UPI) is a real-time instant payment system developed by the National Payments Corporation of India (NPCI) to facilitate interbank transactions over cell phones. The UPI payment system is regulated and monitored by the Central Bank of India, the Reserve Bank of India (RBI). According to the publication:
The bank has instructed payment processors to disable SBI UPI for crypto merchants.
This means that SBI bank customers cannot transfer funds to crypto exchanges through UPI to buy cryptocurrencies, including Bitcoin.
An SBI spokesman was quoted as saying, “It is the bank’s policy not to comment on matters related to the issue.”
Several banks in India have restricted money transfers to crypto exchanges. However, the NPCI said in May that it will not block payments to crypto companies using UPI. Instead, it advised banks to decide for themselves based on their own risk assessment whether they would allow transactions with cryptocurrencies.
Now that the SBI has made its decision, many other banks may be reluctant to integrate crypto traders on their respective UPI platforms, the publication said.
One of the largest Indian cryptocurrency exchanges, Wazirx, is already affected. CEO Nischal Shetty told the publication: “We are trying to discuss our points and bring SBI to the table. Wazirx follows KYC (Know Your Customer) and AML (Anti-Money Laundering) guidelines. As the largest crypto exchange in India, millions of Indians are currently affected by this step by SBI. “
What do you think of the State Bank of India blocking payments on crypto exchanges? Let us know in the comments section below.
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