How much a tourist can carry CASH while travelling to Nepal.
Worried by the growing practice of using informal channel for remittances, the government has imposed restriction on carrying Nepali currency abroad or bringing into the country.
Issuing a notice on Thursday, the central bank has said that any Nepali or foreign national will not be allowed to carry more than Rs 5,000 of Nepali currency to abroad or bring it into the country.
The new restriction has come at a time when the practice of taking Nepali currency into foreign countries, particularly labor destination countries, and repatriating it back to the country after exchanging it with foreign currencies of Nepali workers is on the rise.
“You don't need Nepali currency abroad. The practice of carrying money abroad to exchange with foreign currency of Nepali workers there is becoming rampant in recent days. Many migrant workers are found returning home country with Nepali currency by getting their hard-earned foreign currency exchanged in the destination country itself,” Bishma Raj Dhungana, executive director of Nepal Rastra Bank (NRB), told Republica. “The move is intended to fight possible money laundering, to ensure that the remittances enter into the country through formal channel, and to increase the central bank's foreign exchange reserve,” he added.
Officials of the central bank say that the money launderers have discovered the relatively 'cheaper' method of 'Hundi' to bring remittances from labor receiving countries after the central bank launched crackdown against the informal practice of international money transfer.
Since the process of getting foreign exchange in Nepal is difficult and investment of Nepali nationals abroad is illegal, central bankers say that many are finding this 'legal loophole' to make foreign investment. “This type of informal practice is also highly likely to facilitate the illicit flow of money as this does not come under record anywhere. This new restriction is also aimed at controlling money laundering,” said Dhungana.
Data compiled by NRB shows that the country received a total of Rs 617.28 billion of remittances in Fiscal Year 2014/15 which accounts for around 22 percent of the total GDP. According to a conservative estimate of NRB, nearly 40 percent of the remittances is making into the country through illegal channels like Hundi.
The central bank has also said that carrying Nepali currency more than the set limit will invoke penalty and punishment as per the Foreign Exchange Act 2019. While the act has entrusted the authority to impose restriction on carrying Nepali or Indian currency in or out of the country to the central bank, NRB was yet to fix the ceiling so far.
Likewise, the central bank has also said that any Nepali or foreign nationals bringing foreign currency equivalent to US$ 5,000 or more in cash will have to make customs declaration.