Topic: ICICI Bank closing accounts involved in bitcoin trading? - page 2. (Read 305 times)

Well if you declaring all your income properly for Income TAX Return then you shouldn't be worry and i suggest start using Axis / SBI Bank from now on . I do not know about credit card purchases but for debit card i do use a lot for PayPal and many other International crypto platforms and there is never ever any question or mail to me about it . Only thing keep in mind that never ever receive Bank Wire direct to your bank account if not coming from your family member abroad .

Friend got a similar message from the bank. He was using credit card to make USD payments to cex.io. so that qualifies as a remittance - and is against the rules of the bank and FEMA.

As for other FUD spready here - you won't go to prison for this as FEMA is a civil offence only and going after small amounts (<5 lakh) is not worth the RBI or ED's administrative resources.

India is one of those countries where earning money is frowned upon. Doing business involves fulfilling a lot of regulations and procedures. Most small business in India aren't savvy enough to hire a corporate lawyer or a team for this. So obviously, they look for ways around regulations. This is one reason that GST has been a back breaker for a lot of small businesses.
Handling Forex is one of these things. It is kindda illegal to possess an international currency if you cannot declare a source for it. The same i suppose stands true for the bitcoin exchanges that don't have base in India.

Such communications are bad news for those delving into BTC trading. The part of the communication that says
If you have withdrawn INR generated from one of the Indian websites by selling BTC, that shouldn't really be taken in the category of "remittances". But they are talking about remittances towards overseas exchanges. That means if you are trading on foreign exchanges in any way, then that is not permitted.

Though it begs the question that how do they assume that you are trading and making "remittances towards foreign exchange"??

As long as you declare everything in Income Tax, you should be fine. 

Banks are doing this by way of abundance of caution. I too received a notice from HDFC asking me to politely stop purchasing Virtual Currencies.

I sold some crypto on Zebpay, coinome and koinex and withdrawn INR to my ICICI Bank account.
Is it breaking any rule?

Good to know about this ..

Well OP did you use credit card or debit card ?

It's not new, and not related to bitcoin. In FEMA rule you can't use your card directly to any exchange outside India for trading. You are lucky, they are just closing account, otherwise you did broke rules and Police can come to your home.

Are u using Zebpay,Unocoin or some other international exchange? If u are using international exchange and i would advice you to use local exchange If u are using local exchange like zebpay then it doesn't come under FEMA. I am also using ICICI services but have not faced such issues. If you are using local exchange and still they are telling you about FEMA rules then you can simply go to court as i would do the same thing.

wow this is bad ... First Kotak now ICICI

Received the below communication from ICICI Bank today early morning. Does this mean they will be closing the accounts of everyone involved in bitcoin trading?

We would like to bring to your notice the below important information on permissible usage of card transactions involving foreign exchange:
Under the Foreign Exchange Management Act (FEMA), 1999, a resident Indian is permitted to make only those foreign exchange transactions on ICICI Bank Cards or Account that are permissible and remittance in any form towards overseas exchange trading through internet/ electronic trading portals is not permitted.
Indian residents are therefore prohibited from trading in foreign exchange in domestic and overseas market, including binary option trading with commodities, stocks, indices, bitcoin index and forex etc.
Please make note of the prohibitions on using your ICICI Bank Cards or Account for such unauthorised transactions in contravention to the FEMA and the regulations issued thereunder and that violation(s), if any, would attract action under the extant laws and regulations against such residents.

In case such transactions are noted on your ICICI Bank Cards or Account, we shall be constrained to close your card or account without any liability or responsibility on the part of the bank.

Looking forward to your co-operation in helping us serve you better.

Sincerely,
 
Rohit Poddar
Head - Privilege Banking