Kathmandu – An agreement has been signed between Nepal Rastra Bank and Reserve Bank of India to regulate cross border payments. Such an agreement was reached between the central banks of the two countries during the visit of MahaPrasad Adhikari, Governor of Nepal Rastra Bank to India.
According to the agreement reached in India on Thursday, an agreement has been reached to establish a bilateral regulatory mechanism in India’s Unified Payment Interface (UPI) and Nepal’s National Payment Interface (NPI) for the development of a secure electronic payment system.
Along with the agreement between Nepal Rastra Bank and Reserve Bank of India, the system development agreement between UPI and NPIB will be implemented. Last May, during the visit of Prime Minister Pushpa Kamal Dahal to India, an agreement was reached between UPI and NPI to advance the process of cross-border payments between Nepal and India.
Implementing the same agreement, the central banks of the two countries signed an agreement on Thursday to regulate cross-border electronic payments between Nepal and India.
In the presence of Nepal Rastra Bank Governor Mahaprasad Adhikari and Reserve Bank of India Governor Shaktikanta Das, the agreement was signed between the top officials of the two banks. It is mentioned in the agreement to establish a bilateral regulatory mechanism for the development of easy, accessible and safe payment system.
Last May, in the presence of Prime Minister Pushpa Kamal Dahal and Indian counterpart Narendra Modi, Nepal Clearing House Chief Executive Officer Nilesman Singh Pradhan and Indian Payments Company NIPL Chief Executive Officer Ritesh Shukla signed the preliminary agreement for cross-border payments between Nepal and India.
After Nepal-India cross border payment is operational, it will be easy for industrialists, businessmen and students. In the total international trade of Nepal, the share of only about 80 percent has been with India. It is expected that the arrangement of cross border payment with India will facilitate the payment of import and export.
The agreement reached in May did not immediately lead to the start of regular border payments with India. The regulatory process is about to proceed after Thursday’s agreement as there was only a preliminary agreement to proceed with the necessary work for cross-border payments.
