Foreign employees working in companies set up under foreign investment in Nepal will now be allowed to send all of their post-tax income back to their home countries.
The new provision comes after the Nepal Rastra Bank amended its unified foreign exchange guidelines on Thursday. Previously, such workers could only remit up to 70 percent of their income.
However, for workers employed under the Industrial Enterprise Act, the limit will remain at 70 percent.
Commercial banks in Nepal can now accept both movable and immovable property as collateral from foreign lenders. While the ownership of the collateral will not be directly transferred to the lender, this change removes the earlier requirement for central bank approval each time a bank acted as an agent to collect loan payments or auction collateral in case of default.
The central bank has also increased the limits on certain foreign payments. For service imports from countries other than India, businesses can now make direct bank payments of up to 8,000 US dollars without special regulatory approval, up from the earlier limit of 5,000 dollars.
For goods imported from India, Nepali individuals and companies can now make payments up to 500,000 rupees, while foreign companies with regulatory clearance can pay up to 4 million rupees both figures are higher than the previous limits.
In another major step, hedging services will now be available to manage foreign exchange risks. Commercial banks and infrastructure development banks authorized by the central bank can now offer hedging and forward contract services to foreign investors, foreign investment companies, lenders, and borrowers something that was not possible before.
This shift in rules signals Nepal’s intent to make its investment climate more flexible and investor-friendly, while also easing operational challenges for both foreign workers and global lenders connected to the country.
