Local bankers too confirmed that there have been huge withdrawals by Nepalis through Indian banks, attributing it to short supply of IC in the domestic market. [break]
They informed myrepublica.com that the trend has grown of late, particularly after unauthorized money changers announced they would pay anyone supplying Indian currency a commission of Rs 3 for every Indian rupee (IRs) 100 and additional gifts in case the denominations are IRs 500 and IRs 1000.
The unauthorized money changers, on the other hand, are selling IRs 100 for Rs 165 -- Rs 5 more than the official exchange rate.
Officials at State Bank of India (SBI) in Farbisgunj branch said that Nepalis are withdrawing at least Rs 10 million worth of IC from different banks in Farbisgunj every day. "The trend of more Nepalis using Visa debit cards to withdraw IC has soared sharply in recent weeks," said S M Q Warsi, manager of SBI, main branch, Farbisgunj.
Of Rs 10 million to Rs 110 million withdrawn from Farbisgunj by Nepalis every day, some Rs 9 million to Rs 10 million are withdrawn using ATM cards.
"Mainly the account holders of Nepal SBI Bank, Everest Bank, Himalayan Bank, Laxmi Bank, Kumari Bank and NIC Bank are taking benefits of Visa debit card (which is valid for withdrawals in Nepal and India) for the withdrawal," said Warsi.
Local money changers said black marketing of the IC has soared rapidly in Biratnagar and other eastern cities and blamed easy access to ATM cards topped with cross-border withdrawal facility for the situation.
Bankers too admitted that commercial banks in Biratnagar are witnessing sharp rise in new clients in recent months.
For instance, Nepal SBI Bank official in Biratnagar said their client base jumped by 950 in the first month of this fiscal year alone, whereas it registered 3,000 new account holders throughout the last fiscal year.
"The rise in clients apparently has not benefitted the bank, as they deposit money in the morning and make withdrawals the same evening," said Amit Koirala, chief of Nepal SBI Bank branch, Biratnagar.
Banks in Farbisgunj said such unprecedented rise in withdrawal by Nepalis has made situation difficult for them. But they noted that the Indian security officials have not taken any actions to control the practice, fearing its possible negative impacts on relations between the banks in the two countries.
"On banks´ request we have intensified vigilance of the people who use multiple ATMs for withdrawals," said Shiva Kumar Jha, deputy superintendent of police in Farbisgunj.
He noted that no concrete actions have been taken against Nepali clients engaged in such practice though.
Farbisgunj police, however, had nabbed and jailed an Indian national Ramesh Kumar Bhagat (Munna) for holding 13 ATM cards of different Nepali banks. Police believe Bhagat was using the cards to blackmarket Indian currency in Biratnagar.
Nepal Rastra Bank, meanwhile, has tightened transactions of IC in the local market. Issuing a circular, it has instructed banks and money changers to furnish it details of people who withdrew IRs 25,000 in one transaction or IRs 200,000 in a month.
Related story
Smuggling rife at Maheshpur small customs
