March 19: Nepal Rastra Bank has made provisions for banks and financial institutions (BFIs) as well as payment service providers to engage in cross-border payment service between Nepal and India.
Issuing an instruction on Friday, the central bank said it has revised its policy allowing traders and workers in Nepal and India to use digital platforms to transfer money.
The new provisions also allows tourists to use QR code for payments of goods and services in Nepal.
As per the central bank’s directive, Indian citizens working in Nepal can also send money back to their homes using online services such as e-banking, inter-bank transaction, mobile banking and QR codes. With the provision in place, the Indian workers can now deposit money into personal accounts opened in Indian banks.
The NRB, however, has fixed the limit on remitting money from Nepal to India through the digital platforms. Accordingly, Indian workers can remit salaries of up to IRs 15,000 per day and INR 100,000 per month.
Similarly, the NRB has also made arrangements for Nepali workers in India to send money to Nepali banks through electronic banking (e-banking), interbank payments, mobile banking, and QR codes via the National Payment Switch.
NRB Spokesperson Dr Gunakar Bhatta told New Business Age that this facility is already available for Indian nationals in Nepal while Nepali citizens in India will be able to use such facility soon. The cross-border payment will put an end for tourists from Nepal and India to carry cash during their visit across the border.
The cross-border payment system is expected to help Nepali entrepreneurs as well as the Indian visitors as they will be spared the hassle of carrying bundles of cash since Indian banknotes of denominations of above INR 100 are banned in Nepal.
Prime Minister Puspa Kamal Dahal had signed a bilateral agreement to this effect with India during his state visit to the neighbouring country in last June.
The agreement was formalized last month after the two sides consented on establishing a joint mechanism to look over the transaction to be carried out via the electronic payment system.
