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India to Nepal remittance service launched

Sanket Mohapatra's picture

The Reserve Bank of India (RBI) announced the launch of the “Indo-Nepal Remittance Scheme” for Nepali migrants in India.  This scheme allows migrants, including those who don’t have bank accounts, to send up to Rs. 50,000 (about $1000) in a single transaction. At the receiving end, the scheme allows recipients who don’t have a bank account to receive the transfer through a designated money transfer company.  This is indeed welcome news for those interested in reducing the burden on migrants and increasing the development impact of remittances in Nepal!  
There is no fee for a bank-to-bank transfer through any Indian commercial bank that participates in the National Electronic Fund Transfer (NEFT) to any bank in Nepal. For receivers who don’t have a bank account, there is a minimal charge of Rs 50 for a Rs 5000 transfer (1 percent of the transfer amount) and a flat fee of Rs. 75 for larger amounts upto Rs. 50,000. 
When using the service, Nepali migrants need to produce some form of identification (a passport, driver's license, telephone bill, etc.) in order to comply with Know Your Customer (KYC) requirements.  Given of the large number of undocumented Nepali migrants in India, policymakers should ensure that these requirements are inclusive and not become a barrier to limiting the service only to those migrants with legal status. 


Submitted by Bharath on
Hi Dilip It is good that the RBI has focused on this issue. However by making sure that the banks do not make any money from this service, the RBI has made sure that the banks will not publicise this at all. In fact they will probably dissuade Nepalis from using this service. The RBI would have been far better off liberalising the market with effective regulation (leading to new entrants). The subsequent increased usage and competition would bring down transfer rates anyway....the current approach of dictating pricing at zero and ensuring no marketing will lead to minimal takeup takeup. Its purely lip service to the idea than any real desire to help the Nepalis or poorer sections of the sub-continent. It would be interesting to hear other views. Bharath

Submitted by Arjun on
Dear sir I am arjun from Bangalore is this facility is available in Bangalore or not i am not getting such agencies which will transfer money to nepal from here ... please kindly help me. Thanks & Regards Arjun

Submitted by Sanket on
We have recently received requests for information on banks through which the Indo-Nepal remittance service is available. The Indo-Nepal remittance service is available through all Indian banks participating in the National Electronic Fund Transfer (NEFT) system (see for a list of banks participating in NEFT). However, the take-up of the Indo-Nepal remittance service was initially low as correctly pointed out by the commenter above. Recognizing low fees as one of the reasons for the low levels of usage, the Reserve Bank of India (RBI), revised the fees upwards in February to create incentives for Indian banks to promote the service. According to the circular available at "", the RBI also instructed the banks "to take necessary steps to create awareness about the [Indo-Nepal remittance] scheme amongst officials manning branches as also the branch counters".

Submitted by Anurag on
I've been trying to make a remittance of $ 1000 (or equivalent Indian/Nepali currency to a small company in Nepal who did some work for my company, without any success. Banks just refuse to make the remittance. It is over 2 months. Some guidance / assitance in this regards will be valuable. thx

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