Nepal and India are increasing efforts to create a specialized electronic payment system connecting the two nations.

Nepal Rastra Bank (NRB) announced that an agreement was reached between the National Payments Interface of Nepal and the Unified Payment Interface of India.

The initiative is poised to facilitate cross-border transactions by leveraging electronic payment gateways. Once operational, the system will enable easy people-to-people fund transfers through mobile banking platforms.

Nepali users will be able to initiate bank transfers to India using a Unified Payment Interface (UPI) ID, while Indian counterparts can reciprocate transfers to Nepal through a unique identifier, such as a mobile number.

Nepal Rastra Bank revised its policy in January 2023, opening avenues for foreign investors to participate in Nepal’s digital payment ecosystem. The amended guidelines now permit foreign direct investments in payment service provider firms and payment system operator firms, up to 15 percent of the total capital.