India's Reserve Bank of India and Financial Intelligence Unit are reportedly examining offshore cryptocurrency cards that allow residents to spend digital assets on everyday purchases without connecting Indian bank accounts. Providers such as RedotPay offer cards operating through Visa and Mastercard networks, converting crypto balances into rupees during transactions.

The scrutiny follows reports of sudden card deactivations and restricted access among Indian users. Authorities are examining potential violations of payment regulations, foreign exchange requirements and money laundering safeguards, although no formal enforcement action has been publicly announced.

RBI & FIU Examine RedotPay Crypto Cards

The RBI and Financial Intelligence Unit India are reportedly investigating offshore prepaid cryptocurrency cards used by Indian residents for domestic spending. According to reporting by The Economic Times, the review includes services offered by overseas providers such as RedotPay.

These cards allow customers to hold cryptocurrency with foreign service providers and use it for purchases in India. Transactions are processed through conventional payment networks, including Visa and Mastercard, making the payments appear similar to regular card purchases.

The reported scrutiny concerns whether these arrangements comply with India's payment system regulations and foreign exchange requirements. Authorities are also understood to be examining the role of international card networks in facilitating these transactions.

How Offshore Crypto Cards Convert Cryptocurrency Into Rupees

Offshore crypto cards connect digital asset balances held with overseas providers to conventional payment infrastructure. When a customer purchases something in India, the provider converts the required cryptocurrency into rupees through its payment arrangement.

This mechanism allows Indian users to pay domestic merchants without directly linking an Indian bank account to the card.

RedotPay and similar providers offer cryptocurrency funded payment products connected to international card networks. Users have reportedly relied on these services for online shopping, mobile recharges, flight bookings and other everyday expenses.

Some physical cards have also reportedly been used to withdraw rupees from Indian bank ATMs.

The arrangement has attracted regulatory attention because cryptocurrency remains with an offshore provider while spending takes place within India's domestic payment ecosystem.

🇮🇳CRYPTO CARD USERS IN INDIA COULD FACE NEW RESTRICTIONS.

RBI and FIU-IND are scrutinising offshore crypto cards linked to Visa and Mastercard, including RedotPay.

Authorities are examining whether these cards allow Indians to spend stablecoins like regular rupees while bypassing domestic payment regulations and FEMA rules.

— Kashif Raza (@simplykashif) November 2, 2026

Indian Users Report Card Deactivations & Access Restrictions

Several Indian users have reported that their offshore crypto cards stopped working around October 29, 2026. Complaints circulating on social media also describe restrictions affecting access to certain provider websites.

These reports have raised questions about whether payment networks have begun declining transactions involving offshore cryptocurrency cards used in India.

However, the precise reason behind individual deactivations has not been officially confirmed. Neither the reported restrictions nor the regulatory scrutiny establishes that every offshore crypto card has been blocked nationwide.

The disruptions have nevertheless left users uncertain about their ability to continue making payments through these services.

FEMA Violations & Money Laundering Concerns Under Review

The investigation centres on potential violations of the Foreign Exchange Management Act and India's payment regulations. Offshore cryptocurrency cards may raise questions when Indian residents hold digital assets with foreign custodians and use those balances to pay domestic merchants.

Financial authorities are also concerned about money laundering risks and customer verification standards. Some offshore card programmes reportedly advertise limited identity verification, raising questions about how providers establish customer identities and monitor the origins of funds.

The regulatory concerns extend to whether these products operate outside India's prepaid payment instrument framework and applicable payment settlement requirements.

Despite the reported examination, no formal enforcement action against RedotPay or a nationwide prohibition on offshore crypto cards has been publicly announced. The RBI and FIU have not issued a detailed public statement confirming the scope of the review.

The immediate issue remains whether cryptocurrency funded cards connected to international payment networks can serve Indian customers while complying with domestic payment, foreign exchange and anti money laundering requirements.

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