India’s SBI Latest Bank to Bar Payments to Crypto Exchanges

The State Bank of India (SBI) has cut off payments made with its Unified Payments Interface (UPI) to cryptocurrency exchanges, the EconoTimes reported.

The news comes as several Indian banks have been disabling fund transfers to crypto exchanges, the report stated.

SBI bank customers will not be able to transfer funds via the UPI to crypto exchanges to buy crypto, including bitcoin, according to the report.

SBI’s decision might make it so that other banks are reluctant to accept cryptocurrency merchants for onboarding onto their UPI platforms, the report stated.

However, the National Payments Corporation of India (NPCI) said it would not be blocking payments to crypto companies using UPI. The NPCI has instead said banks should make their own decisions on what to do about crypto payments, according to the report.

Wazirx, one of the largest Indian crypto exchanges, has come out against SBI’s decision. CEO Nischal Shetty said the company is trying to meet SBI and discuss the ways its decision is affecting millions of Indians, the report stated.

Digital currency has been seeing mass shifts in how it’s perceived. The Bank for International Settlements (BIS) has been vocal this month about central banks adopting central bank digital currencies (CBDCs).

Read more: BIS Official Urges Central Banks to Adopt Digital Currency

Benoit Coeure, a former European Central Bank official, said Sept. 10 that those not adopting crypto could be at risk of falling behind.

“We should roll up our sleeves and accelerate our work on the nitty-gritty of CBDC [central bank digital currency] design,” he said. “CBDCs will take years to be rolled out, while stablecoins and cryptoassets are already here. This makes it even more urgent to start.”

India is among those countries looking to institute a CBDC, with plans to launch a trial soon.