Central Bank Encourages E-Payment

Restricts cash withdrawal through credit card to 10 percent

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Central Bank Encourages E-Payment

May 26: Nepal Rastra Bank (NRB) has issued a new circular to encourage e-payment transaction in the country. According to the new provision of the central bank, credit card holders can now withdraw only 10 percent cash from their credit limit. Analysts say this provision encourages credit card holders to carry out cashless transaction.

The new directive issued by the central bank’s Payment System Department on Friday, May 24, discourages cash transaction by credit card holders in normal condition.  The bank earlier on July 15, 2018 had restricted cash withdrawal from credit cards to 25 percent of the total credit limit.

According to the bank, it took the measure to significantly reduce cash withdrawal after finding that the credit card users were withdrawing cash massively. The new directive states that the card holders should withdraw 10 percent cash from the credit limit only during emergencies.

Prepaid card doesn’t have such limitations.  At present, debit card users are allowed to withdraw cash from Rs 500 to Rs 25,000 at a time.  

The central bank has made it mandatory to make cash withdrawal from credit cards available even if the issuer and acquirer are from different institutions and that the charges levied for the transaction service should be made public.

Likewise, the new directive of Nepal Rastra Bank has also notified that pin numbers are not required for the customers in transactions up to Rs 2000 at a time through Near Field Communication Technology (NFCT) card issued by the banks and financial institutions (BFIs). BFIs themselves should manage the risks and transaction number, states the directive.

Likewise, customers can make a maximum payment of up to 50,000 daily through mobile banking. But in cases where there are no billing system or transaction details available, customers can deposit or withdraw amount worth only Rs 100,000 per month through mobile banking.

 

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