Recently, Nepal Rastra Bank (NRB) announced the international payment facility of up to $500 per year. It has now been official. Meaning, you can now directly purchase international goods and services through prepaid cards that will be issued by ‘A Class’ institution banks in Nepal.
It is to be noted that you can’t own more than one such card from multiple banks or else be punished under Foreign Exchange (Regulating) Act 2019. You are also obliged to Money Laundering Prevention Act 2064 during usage. Moreover, you can’t use it for capital transactions or in ATMs.
With both commercial and development banks authorized to issue prepaid cards of up to $500 for a year, international payment has finally become statutory in Nepal. Previously, you had to rely on international cards for such payments.
Any person, firm, company, or organization can get their balance in Nepali Rupees in their bank accounts exchanged to convertible foreign currency to be used via prepaid cards. All they need to do is submit the KYC form along with Permanent Account Number (PAN) to respective banks. This means they can request for the balance of up to $500 or equivalent convertible foreign currency in their cards based on the given exchange rate, distinctly or all at once.
However, banks are restricted to issue prepaid cards with more than $500 or equivalent convertible foreign currency per year in any case whilst users are restricted to purchase any products, services, and subscriptions that are unlawful under the Government of Nepal (GoN).
Users will also be able to deposit their foreign incomes in prepaid cards. And they can use such income on top of a $500 balance to spend on foreign services, yet no more than $5,000 or equivalent convertible foreign currency per annum.
If in case the amount exceeds $5000 or equivalent, such additional amount can be deposited to individual account — national/international currency.
On the other hand, banks are obliged to submit each transaction in the attached format every month to Nepal Rastra Bank within a week after a month ends. They are responsible to return the deposited amount in each prepaid card to the individual bank account as per the user’s request.
If in case the transactions defy set limits, rules, and regulations, they forward such transactions and respective users’ details to Nepal Rastra Bank, which eventually take necessary actions.