Recently, Nepal Rastra Bank (NRB) had an internal discussion about the international payment system of Nepal. Following this, there were plenty of rumors that NRB will allow Nepalese to make international payments.
The rumor has turned out to be true as NRB added a provision of an international payment system in the first quarter review of monetary policy.
International Payment in Nepal
In a recent event called FonePay Digital Economy Conclave, Maha Prasad Adhikari, the Governor of Nepal Rastra Bank hinted that people could soon be able to make payments in foreign currency from Nepal.
And after some time, NRB has now added a provision in the first quarter review of the Monetary Policy of the fiscal year 2077/78.
To be exact, point 66 of the review document says “Arrangement for online purchase of international goods and services up to limited amount will be made by allowing international currency conversion”.
The need for International Payment System in Nepal
Nepal doesn’t have an international payment system that hinders the growth of the Nepalese market as majorities of businesses are turning to digital payments.
Furthermore, it is almost impossible for Nepalese to pay for Facebook ads, video streaming services, international web hosting services, and such essential international services without help from their relatives living abroad.
Due to this void of international payment, consumers have to rely on middlemen to purchase goods/services with heavy charges.
NRB’s International Payment Concept
NRB is said to have approved the concept of prepaid cards with foreign currency. So, banks can now issue prepaid cards for international payments with the following guidelines and restrictions.
- Maximum fund of $500 only for the international payment.
- Existing funds in NPR in the bank account can be converted to foreign currency for international payment.
- Payment can only be made for the purchase of goods and services allowed by the law.
- One international payment card per consumer.
- KYC and PAN will be needed to apply for the prepaid card.
- If the cardholder is able to generate foreign income amounting to at least double the card amount of $500, additional funds may be deposited to the card.
There is no word on when this provision will be applied. Also, intentional payments can be made for goods/ services allowed by the law only. So, it might take some time before this system comes to use.
Nevertheless, this is a huge relief for people who need international payment.
International payment is pretty much essential these days if you are associated with digital marketing, online freelancing, and various services requiring international payment. This will also allow Nepali consumers to enjoy international services such as Spotify and Netflix.