Banking Law

About the Blog

A huge number of banking legislation and statues in India makes it a little complicated subject matter and the importance of bank in one’s life makes it important to understand these laws in a simple and elaborated way. Here, the ISLR Blog section is dealing with the two very specific concepts of the banking law i.e. Islamic banking and White Label ATMs. On one hand, the Islamic banking laws which incorporates some religious values and sentiments while regulating the banking sector, which is majorly based on the Profit-sharing and loss bearing based on Equity. on the other hand, the White label ATMs which aided in the easy and quick movement of certain banking activities to ease the cash flow reaching the individual, specifically in the rural area of the Nation. The ISLR blog aims to provide a better understanding of these two areas of banking law.


Are White Label ATM’s driving ATM penetration in India? by Aarchie Chaturvedi and Pritesh Raj
India has always faced a cash crunch, particularly post demonetization, which has resulted in the rise of White Label ATMs. One cannot expect the government and private banks to execute all the tasks concerning the circulation of money in an economy having such a huge population. Therefore, to ensure the smooth flow of cash in public, the government has allowed WLA’s to operate in India, to ensure the cash flow even to the remotest corners of the country.
Permission to operate WLA’s comes with its own set of guidelines that are indispensable and must be followed. But what needs to be analyzed is whether those guidelines are justified, because the WLA operators are continuously facing huge losses due to the lack of revenue from the WLA’s, which they operate. 
In this article, we have scrutinized the different aspects of the functioning of WLA’s in India, and the drawbacks in the guidelines which regulate the functioning of WLA’s nationwide. In addition to this, we have also suggested necessary changes which can lead to a just solution for parties on both sides of the aisle.

Islamic Banking – A system with no usury by Joanna Joshua
Islamic Banking is gaining importance in modern times as it is based on interest-free banking which has its roots in Shariat Law. It has evolved from only being practiced in the Middle Eastern nations for the disadvantaged classes of society to being a part of the banking systems of many nations across the world. The money that is collected is used to invest in low-risk businesses such as tutoring, direct sales, certain service businesses, etc. This article explains how this system works with the help of relevant examples and highlights the different types of Shariat Compliant Projects that one can undertake with a view of avoiding anything haram. The article also explains how Islamic banking was introduced in India and the possible ways of implementing it in the Indian Banking system.

A Dilemma on The Legal Enactment of Virtual Currency in The Forthcoming Virtual Business Era in India by Angela Veronica and Yohanna Amelia Simanjuntak
The term cryptocurrency as virtual currency has entered the alliance of electronic transactions in global society without concerning countries’ boundaries. Since 2013 until now, in India the admittance of the use of cryptocurrency is subject to contention due to the potential risks despite the benefits it entails. The issue got complicated throughout 2018 when RBI announced the blanket ban against cryptocurrencies without many considerations. This issue lasts until 2020, when the Supreme Court of India lifted RBI’s blanket ban. However, the action does not profess cryptocurrencies as a legal tender or commodity. The authors argue that in regard to the pros and cons regarding the dilemma, the government of India needs to undertake the situation by enacting regulation concerning the use of cryptocurrency irrespective of the inclination of the binding regulation.

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