TL;DR Breakdown
- Crypto exchange in India frustrated as banks withdraw payment support
- Exchanges find alternatives to banks
Crypto exchange firms in India are beginning to lament as banks are have stopped providing support for them.
This is in the wake of regulatory uncertainty from the Indian central bank – Reserve Bank of India (RBI). Reuters reports that crypto exchanges in India are struggling to secure viable and secure payments solutions for their customers to move funds.
The global news agency (Reuters) notes that other payment gateways are also cutting ties with exchange firms beyond banks. This is in the wake of RBI’s statement that it does not favor cryptos, citing concerns over financial stability.
Exchanges in India are now struggling to survive as they are being overwhelmed by troubled customers on their social media platforms. Perturbed exchange firms have also been severely hit with transaction blockades.
ZebPay, one of the most popular crypto firms in India, said it has stopped payment due to the development, Avinash Shekhar, an executive of the firm, told Reuters.
Crypto exchanges seek alternate ways to process payment
Exchange firms trying to circumvent payment problems caused by banks and payment processors are partnering with smaller payment processing firms to get the job done.
Reportedly, other exchanges are working on developing their payment gateways.
However, partnering with these small payment processors is only a temporary solution and not a thorough deal, an anonymous crypto operator said.
These small payment processors cannot handle large volume transactions, which results only infrequent customer complaints.
The only other option is offering settlements using peer-to-peer systems. Moreover, popular crypto platforms like WazirX have been forced to stick to P2P payments on certain days. While exchanges like Vauld facilitate bank transfers with manual settlements.
Processing payment is undoubtedly a big problem, especially as a result of widespread crypto adoption in India. Chainalysis; a crypto analytical firm recently said that crypto investment in India surged in the country over the past months by 19,000 percent.
However, payment processing problems from bank and other operators is not a new thing for the crypto industry.
The Central Bank of Nigeria, earlier in 2021, stopped banks from processing crypto payments, and P2P crypto trade was a simple solution to it by Nigerians.
Nigerians now utilize the P2P market feature to make withdrawals from their crypto wallets.
