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🇳🇵 Nepal /Technology

Nepal, India launch digital remittance service for migrant workers

From Kathmandu Post · () English

Summarized and contextualized by DistantNews.

At a glance

News Named sources New plan
  • Nepal and India have launched a new digital remittance service connecting their banking systems.
  • The service allows migrant workers in both countries to send money home directly through banking applications, bypassing traditional channels.
  • This initiative aims to lower costs, reduce reliance on informal transfer networks like hundi, and enhance security for workers' earnings.

Migrant workers in Nepal and India can now send money home more easily and cheaply thanks to a new digital remittance service. The initiative connects Nepal's National Payments Interface with India's Unified Payments Interface, allowing direct transfers through banking apps.

The system would allow Nepali workers in India to send money home through banking channels and mobile devices at a lower cost.

— Guru Prasad PaudelNepal Rastra Bank spokesperson explaining the benefits of the new service.

Previously, workers relied on remittance companies or informal networks, which were often costly and less secure. This new service aims to discourage illegal money transfer methods like hundi and provide greater security for workers' earnings. Nepal Rastra Bank spokesperson Guru Prasad Paudel stated that the system allows workers to send money home through banking channels and mobile devices at a lower cost.

The service is initially available for person-to-person transfers. Nepali citizens working in India and Indian citizens working in Nepal are eligible. Several Nepali banks, including Everest Bank, Global IME Bank, Machhapuchchhre Bank, Nabil Bank, and Nepal SBI Bank, support the service for sending and receiving funds. Customers of Himalayan Bank, NMB Bank, and Siddhartha Bank can receive transfers.

Previously, workers had to depend on remittance companies. Now they can transfer money directly to family members through the banking system and mobile banking platforms.

— Guru Prasad PaudelNepal Rastra Bank spokesperson contrasting the new service with previous methods.

Transaction limits vary: up to INR 200,000 per transaction from India to Nepal, with no monthly limit. Transfers from Nepal to India are capped at INR 15,000 per transaction and INR 100,000 monthly. A service charge of INR 150 applies to each transaction. Neelesh Man Singh Pradhan, CEO of Nepal Clearing House Limited, highlighted that digital transfers reduce the risks associated with carrying cash across the border and increase transparency.

Digital transfers will reduce the risks associated with carrying cash across the border and make transactions more transparent.

— Neelesh Man Singh PradhanNCHL Chief Executive Officer discussing the security and transparency benefits of the digital service.
DistantNews Editorial

Originally published by Kathmandu Post. Summarized and contextualized by our editorial team with added local perspective. Read our editorial standards.

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