NRB raises spending ceiling for Nepalis with Forex accounts
August 8, 2016 08:55 AM NPT
KATHMANDU, Aug 8: Nepal Rastra Bank (NRB) has raised the maximum limit that a Nepali with a foreign exchange account in Nepali banks can spend in a year to the equivalent of US$ 15,000.
Previously, a Nepali who had an account in foreign exchange in a Nepali bank was allowed to purchase goods and services of only $10,000 using their foreign-currency account.
Issuing a circular Sunday, NRB -- the central bank -- said that Nepali nationals having accounts in foreign currency can purchase services or goods worth $15,000 annually while they have to seek other options to spend foreign exchange above the newly-fixed ceiling.
Those people, firms, companies and organizations, who have income in foreign currencies, can open foreign currency accounts. So far, the central bank allows banks to open foreign exchange accounts in those currencies that it has allowed them to both sell and buy. NRB allows banks to sell and buy 19 foreign currencies.
According to central bank officials, the move is intended to encourage people to deposit or save their money in foreign currencies in their bank accounts. “We have increased their limit to encourage people and firms who receive foreign currency for their goods sold or services rendered to open foreign exchange accounts. Since people can spend up to $15,000 a year from their accounts abroad or make payments even when they are in Nepal, they will be encouraged to save it in the foreign exchange accounts,” Bhisma Raj Dhungana, executive director at Foreign Exchange Department of NRB, says.
“With this revision of the ceiling, those who travel abroad frequently and return with foreign currency savings will also have the incentive to deposit the remaining currency in their accounts,” he adds. However, the newly-issued circular states that Nepali requiring a higher amount of foreign currency can get the required after following due process.
The new ceiling will not affect foreign citizens.
NRB ALLOWS banks to sell 5 MORE CURRENCIES
NRB says it is going to start publishing the selling rates of five more foreign currencies in addition to their buying rates, allowing banks also to sell those currencies. Previously the central bank only published the buying rates of these currencies. The publishing of just the buying rate of a foreign currency means that banks are allowed only to buy the particular currency, but not sell it. The central bank is releasing the new circular on Monday lifting the restriction on selling -- Swedish Kroner, Danish Kroner, Hong Kong Dollar, Kuwaity Dinar and Bahrain Dinar. “Once the selling rate is also published, people requiring these currencies can directly buy from banks,” said Dhungana.