ICICI Bank closing accounts involved in bitcoin trading?

[sardasa]

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

[1715287333]

1715287333

[1715287333]

1715287333

[Blackshadow007]

wow this is bad ... First Kotak now ICICI

[coindrops]

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

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.

[deadley]

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

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.

[Blackshadow007]

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

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.

Good to know about this ..

Well OP did you use credit card or debit card ?

[sardasa]

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

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.

Good to know about this ..

Well OP did you use credit card or debit card ?

I sold some crypto on Zebpay, coinome and koinex and withdrawn INR to my ICICI Bank account.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

[TucoRamirez]

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.

[amishmanish]

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

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.

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"??

[bitdragon84]

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

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.

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"??

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.

[Blackshadow007]

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

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.

Good to know about this ..

Well OP did you use credit card or debit card ?

I sold some crypto on Zebpay, coinome and koinex and withdrawn INR to my ICICI Bank account.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

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 .

[bitcoindian]

https://rbidocs.rbi.org.in/rdocs/notification/PDFs/N20RB29574DA17294D5C93E4951B2FC86666.PDF  FEMA ACT revised again in Nov 2017 all sections about the act is available

[Johny8469]

https://rbidocs.rbi.org.in/rdocs/notification/PDFs/N20RB29574DA17294D5C93E4951B2FC86666.PDF  FEMA ACT revised again in Nov 2017 all sections about the act is available

Does it mention anything about crypto? I couldn't find any.

[rupesh2]

on cryptocurrency , neither FEMA mentioned anything nor IT act , govt should clear its stand .

[Guvn0r]

Buying BTC from exchanges other than the ones established in India is a bad idea, as far an Indian citizen is concerned. It is the same with trading forex with foreign brokers - there are strict Foreign exchange rules regarding this - my suggestion would be to respect them and never take them lightly.

I don't think any bank will close your account for buying BTC from Indian exchanges like coinsecure,unocoin etc..people have been buying for years now.

[Blackshadow007]

Buying BTC from exchanges other than the ones established in India is a bad idea, as far an Indian citizen is concerned. It is the same with trading forex with foreign brokers - there are strict Foreign exchange rules regarding this - my suggestion would be to respect them and never take them lightly.

I don't think any bank will close your account for buying BTC from Indian exchanges like coinsecure,unocoin etc..people have been buying for years now.

Well also in addition buying crypto with Credit card is most bad idea , cause you would be using Bank's funds for it and Bank has complete right to stop you to do that . Never got any message or notice from bank for my usage on international .

[Johny8469]

on cryptocurrency , neither FEMA mentioned anything nor IT act , govt should clear its stand .

It's not on FEMA original paper but on banks website showing FEMA rules, banks mention you can't buy crypto. Banks may have invented their own FEMA rules.

[RocketSingh]

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.

Do u mean sending money to fully compliant Japanese exchanges from India and receiving from them using SWIFT code is illegal?

[legendster]

wow this is bad ... First Kotak now ICICI

This is old news, they keep saying this but never act on it. Part of the reason being the whole shabang is untraceable.
Tip : get a B2 account if its available in your city and stick to it. Back when I was trading actively I used my B2 account extensively. Will not go into the details of the entire turnover but it was a lot. And this was after RBI made their rules more stringent in (and after) 2008.

[Johny8469]

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.

Do u mean sending money to fully compliant Japanese exchanges from India and receiving from them using SWIFT code is illegal?

Yes. Totally. Many banks have written it in fine print.

wow this is bad ... First Kotak now ICICI

This is old news, they keep saying this but never act on it. Part of the reason being the whole shabang is untraceable.
Tip : get a B2 account if its available in your city and stick to it. Back when I was trading actively I used my B2 account extensively. Will not go into the details of the entire turnover but it was a lot. And this was after RBI made their rules more stringent in (and after) 2008.

B2 is useless piece of crap. You can only transfer 25k INR through it.
Edit: it's not available anymore for new customers.

[RocketSingh]

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.

Do u mean sending money to fully compliant Japanese exchanges from India and receiving from them using SWIFT code is illegal?

Yes. Totally. Many banks have written it in fine print.

Can u provide some authentic link to substantiate your claim?