Kathmandu, Oct 6: Nepal Rastra Bank (NRB) has raised foreign payment limits under revised foreign exchange regulations, easing transactions related to imports, overseas services and banking.
The revised rules increase limits for advance import payments, aircraft engines and spare parts, satellite services, tourism services and foreign currency card transactions.
Banks and financial institutions can now provide Nepali citizens with foreign exchange of up to $30,000 annually for medical treatment abroad and the purchase of medicines and medical equipment, subject to prescribed procedures. The previous limit was $15,000.
Nepali telecommunications companies can now make annual payments of up to $500,000 through banks and financial institutions for leasing or using satellite services from foreign providers. The previous ceiling was $100,000.
Commercial banks can also provide foreign exchange of up to $30,000 per transaction, or its equivalent in other convertible currencies, based on approval or recommendations from the relevant regulatory authority and required documents. The previous limit was $15,000.
Payments exceeding $30,000 require approval from NRB’s Foreign Exchange Management Department along with a recommendation from the regulator. Where no regulator exists, or the regulator cannot approve or recommend an agreement, payments exceeding $8,000 require NRB approval.
A foreign bank guarantee will now be required for advance foreign currency payments exceeding $30,000 per transaction. The previous threshold was $15,000.
NRB has also raised the limit for payments to Indian entities. Nepali and foreign organizations or companies legally registered to operate in Nepal can now make payments of up to INR 6 million per transaction to Indian organizations or companies for various services through commercial banks, subject to regulatory approval or a foreign exchange recommendation. The previous limit was INR 4 million.
Payments exceeding INR 6 million require approval from NRB’s Foreign Exchange Management Department. Such approval will also be required for smaller amounts when no regulator exists or regulatory approval cannot be obtained.
NRB has also revised rules governing foreign currency cards. Foreign currency earned by cardholders through the online export of services can now be credited directly to their cards. At the cardholder’s request, the funds can also be transferred to a domestic or foreign currency account.
If a card balance exceeds $10,000, or its equivalent in another convertible currency, the excess amount must be transferred to the cardholder’s domestic or foreign currency account. The previous ceiling was $5,000.
Under another major change, Nepali airlines can make advance payments of up to $500,000 through banks and financial institutions when importing aircraft engines, spare parts and similar equipment. Such payments require documents including a recommendation from the Civil Aviation Authority of Nepal, but airlines will not be required to provide a foreign bank guarantee.
People’s News Monitoring Service
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