Deadline for remittance companies to raise minimum paid-up capital to Rs 100 crore extended by two years

Kathmandu. KATHMANDU: Nepal Rastra Bank (NRB) has extended the deadline for remittance companies to meet minimum paid-up capital by two years. Through the ‘Remittance Bylaws, 2079 (Second Amendment)’, the remittance companies have to reach a minimum paid-up capital of Rs 100 million by the end of Ashad 2087.

Earlier, there was a provision that such capital should be maintained within Ashad end, 2085 BS. Earlier, the Nepal Rastra Bank (NRB) had directed the banks to increase their capital in a phased manner. According to the agreement, the government had to increase the amount to Rs 30 million by 2081, Rs 40 million by 2082, Rs 60 million by 2083, Rs 80 million by 2084 and Rs 10 crore by 2085. However, after the new amendment, this target has been removed and a provision has been made to increase the capital directly to 100 million by 2087.

Nepal Rastra Bank (NRB) has also made arrangements to make remittance transactions more systematic. The amendment bill clarifies the process of granting, renewing, suspending and scrapping the license for remittance transactions, penalties and procedures for merger and acquisition of companies.

As per the new provision, remittance companies can operate as payment service providers or payment system operators through their subsidiaries after obtaining permission from the Nepal Rastra Bank. In addition, they will also be able to do business by issuing remittance cards and doing other tasks as specified by the Rastra Bank. Banks and financial institutions have also been allowed to carry out remittance transactions.

To get the license, the remittance company should have a minimum paid-up capital of Rs 25 crore and in case of other companies it should have minimum paid-up capital of Rs 10 crore.