Enhancing Cross-Border Digital Payments: Nepal and India Sign Agreement for Seamless Transactions

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Enhancing Cross-Border Digital Payments: Nepal and India Sign Agreement for Seamless Transactions

The agreement between Nepal Clearing House Limited (NCHL) and the National Payments Corporation of India (NPCI) to enable payments between the two countries is a significant that has the potential to ease transactions and boost and trade. The agreement allows authorized apps both Nepal and India to operate seamlessly, enabling Indian tourists to make direct payments in Nepal using their Indian wallets, and Nepalis to do the same in India.

initiative is expected to make spending in Nepal convenient for Indian tourists, as they can use popular Indian payment apps such as BharatPe, PhonePe, , and Paytm. Similarly, Nepalis can use apps like connectIPS, Khalti, eSewa, IME Pay to make digital payments at merchants in India using Nepal's Unified Payment Interface and vice versa. This move will reduce the hassle of carrying cash and cut down transaction costs for traveling between the two countries.

While the agreement is a positive step towards greater financial inclusion and digital between Nepal and India, there are still some logistical hurdles to overcome. Currency conversion, dissimilar payment infrastructure, and regulatory differences to be addressed for smooth cross-border digital payments. However, officials are hopeful that these challenges can be resolved within months.

The agreement will particularly benefit Nepalis traveling to India for purposes such as treatment, education, and business, as well as Indian citizens involved in cross-border trade. By facilitating digital payments, it opens up opportunities for greater and commerce between the two nations.

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However, some critics argue that a broader strategy involving multiple partners will be necessary for Nepal to fully leverage the potential of the digital payments ecosystem. Nonetheless, the agreement between NCHL and NPCI represents a significant and reflects the immense potential within Nepal's thriving fintech sector.

Overall, this development is a positive step towards enhancing financial connectivity and ease of transactions between Nepal and India, which can have a significant on tourism, trade, and economic integration between the two countries.

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