RBI Urges Caution Over Indian Carpool App sRide

India’s central bank says the country’s largest carpooling and bike pooling app is operating an unauthorized prepaid wallet.

The Reserve Bank of India (RBI) issued its warning Tuesday about sRide, which the bank says is operating a “semi-closed prepaid instrument” — its wallet — without permission from the bank, under the 2007 Payment and Settlement Systems Act.

“As such, any person dealing with sRide will be doing so at their own risk,” the RBI said in its announcement, urging the public use caution when dealing with unauthorized entities.

The bank posted a list of authorized businesses on its website.

Based in the Indian state of Haryana, sRide also has operations in the U.S., providing rides in Boston and the New York area.

Read more: RBI Official Likens Crypto to ‘Ponzi Schemes’

Last week, RBI Deputy Governor T. Rabi Sankar likened cryptocurrencies to a pyramid scheme.

“We have also seen that cryptocurrencies are not amenable to definition as a currency, asset or commodity,” Sankar said in a speech. “They have no underlying cash flows, they have no intrinsic value … they are akin to Ponzi schemes, and may be even be worse.”

Sankar’s comments followed an equally gloomy assessment of digital currencies from RBI Governor Shaktikanta Das, which came following news that the the Indian government was creating a taxation framework for cryptocurrencies.

In 2021, the central bank said it had “serious concerns” about the stability and exchange management of cryptos, while also highlighting the difficulty of regulating intangible currencies which originated outside of India’s borders.

“Cryptocurrencies are a serious concern to RBI from a macroeconomic and financial stability standpoint,” Das said. “As the central banker, we have serious concerns about it and we have flagged it many times.”