Nepal Rastra Bank has issued ‘Nepal Rastra Bank Remittance Bylaws, 2079 to better manage the remittance companies and payment service systems.The NRB has cancelled Remittance Bylaws 2067. In order to get a license to carry out remittance business, the minimum paid-up capital of the company should be Rs. 250 million.
According to the new bylaws, remittance companies will have to maintain a minimum paid-up capital of Rs. 250 million rupees in order to obtain a license to conduct remittance transactions by issuing remittance cards and acting as a payment service provider or payment system operator through a subsidiary company.
In the case of others, the NRB has made arrangements to maintain a minimum paid-up capital of Rs.100 million. Before the bylaws come into effect, the remittance company that has obtained a license will have to raise its capital by mid-July 2028.
A company dealing only in remittances shall have a minimum paid-up capital of Rs. 30 million by mid-July 2024, a minimum of Rs. 40 million by mid-July 2025, a minimum of Rs. 60 million by mid-July 2026, a minimum of Rs. 80 million by mid-July 2027 and a minimum of Rs. 100 million by mid-July 2028.
To raise the required capital, remittance companies can also participate in mergers and acquisitions. If the Department under the NRB deems it appropriate to grant a license for remittance work, the Department will grant a license by charging a lump sum of Rs. 200,000 to conduct remittance transactions by issuing remittance cards and acting as a payment service provider or payment system operator through a subsidiary company for five years.
For other remittance companies, the Department will provide a license by charging a fee of Rs. 100,000 for a period of five years. A total of Rs. 20 million should be kept with the NRB as collateral for the work related to payment service provider or payment system operator, the issuance of remittance card and remittance transactions. For others, a collateral of Rs. 10 million will have to be kept in the NRB.
There is a provision that the collateral amount can be kept in cash or in the form of a guarantee issued by banks and financial institutions. In the case of remittance companies that have obtained licenses before the implementation of the bylaws, the Department will withdraw the previous license and issue a new license based on the application received from the remittance company that has paid up capital of Rs. 250 million.
Source : TRN,