On 30th January 2023, Nepal Rastra Bank issued a revised unified directives i.e. “Unified Directives Related to Payment Systems 2079” by unifying the first unified directives i.e. “Unified Directives Related to Payment Systems 2078” and the new directives issued thereafter. In this article, we cover the major provisions and changes in the unified directives. 

Provisions related to Electronic Payment Cards

Electronic payment cards are cards that contain a computer chip or magnetic stripe that stores information about the cardholder and the card issuer, and enables electronic transactions to be made through POS machines, withdrawing cash from ATMs, and for online transactions.

Most commonly used Electronic Payment cards are :-

Debit Cards:- It is linked to your Bank account. While making a transaction, the amount is deducted from your Bank Account. You can’t withdraw more than what you have in your Bank Account.

Credit Cards: This card enables its holder to purchase goods and services on credit, irrespective of the balance they have. The service they obtain is as per the service to which they have subscribed. The amount spent is paid after the prescribed time. 

Prepaid Cards:- A prepaid card is loaded with a specific amount of money prior to use and operates similarly to a debit card. It is not linked to a bank account and can only be spent up to the loaded amount. It is ideal for tourists, students, and for making specific payments like bus fares. 

Who can issue various types of electronic payment cards in Nepal?

*An individual cannot acquire more than one card from a single Bank Account. 

* The  institutions are required to furnish complete information regarding all the available schemes, associated fees, expiration date, terms and conditions prior to the issuance of electronic cards. Moreover, they must inform the customers via SMS & any other electronic medium(if requested) ,15 days prior to the expiration of the card.

Transactions that can be performed using Electronic Cards

• Balance Inquiry & Bank Statements.
• Cash transactions through ATMs & Cash Deposit Machines. 
• Making payments from POS,PTS & Internet or other electronic mediums. 

What happens if your transaction is not settled but the amount is deducted from your account while making payments? 

Both the issuer & acquirer are responsible for the forced settlement of the transactions within the time limit mentioned below:-

• Within the next day (T+1) if both the acquirer & issuer are the same company.  
• Within 3 days(T+3) if acquirer & issuer are different companies of Nepal.
• Within 30 days(T+30)  if the acquirer & issuer are different companies & any one of them is a foreign company. 

* Issuer means the company who has issued the Electronic Card & Acquirer means the company who processes the card transactions for merchants. 

* The acquirer acts as an intermediary between the merchants and card issuers, who verifies the cardholder's account, verifies the availability of funds, and completes the transaction by debiting the cardholder's account and crediting the merchant's account.

Provisions related to the ATM Operations

• ATM transactions should compulsorily be based on Chips & Pins.
• CCTV shall be installed at the place of ATM & memory backup of 90 days shall be stored. 
• CCTV cameras must provide a clear view of the user's face but shall not capture the PIN code entered.

Provisions related to settlements of  E-Wallet Transactions

• Licensed PSPs must open a Settlement Account with an A class Commercial Bank in Nepal for the purpose of settling E-wallet transactions.
• BFIs operating an E-wallet must maintain a Settlement Account in their own bank.
• The total value of E-money issued by the institution shall  not be higher than the balance maintained in such  Settlement Account .
• The funds in the Settlement Account shall only be used for settling customer transactions and cannot be used for any other purposes.

Transaction Limits & Fees for Electronic Transactions

Limitations on withdrawal of  money from ATM : 

However, the above limitation will not be applicable for the payment of bills through cards to the bank account of the concerned business firms for the purchase of services and goods.  

Similarly, the limitation for the contactless transaction through cards(i.e for NFC cards) is 5,000 per transaction.

Limitations on Transaction related to the Mobile Banking and E-Banking

However, this limitation does not apply to:

1. Transfer of amount from one bank account to another bank account of the same person.
2. Payment of tax, fines, revenue, vehicle charge, registration and service fee and other fees.
3. Payment of electricity bill, telephone bill, drinking water bill, insurance premium, social security allowance. 
4. Payment to the designated bank account of Securities Brokers.

Limitations on the transactions done through E-wallet

Note: 

1. Deposits in the wallet can be made 10 times a day at max. 

2. The overnight balance of more than Rs.50,000 cannot be maintained in e-wallet. 

3. No limits while transferring the money from wallet to wallet user’s bank account (i.e. account linked with wallet).

Arrangements related to the fees:

1. The maximum fee of Rs. 15 can be charged per transaction while using the card of one Bank and Financial Institutions to the ATM of other Banks and Financial Institutions within the county.
2. No institutions shall charge any amount for retrieving loss/forgotten username and password of Mobile App/Internet/SMS Banking/Electronic Wallet.
3. No additional fees can be charged in a transaction made through Point of Sale (POS)/Point of Transaction (POT) machines at department stores, marts, hotels, shops and other merchants.
4. Charges on payments made through wallets operated by service providers which is linked to Government of Nepal, Revenue Management Information System (RMIS): 

1. Charge up to Rs. 10 only in Inter Bank Fund Transfer done through Mobile Banking Application or Internet Banking.

Fees for transactions through e-wallet. 

What has changed ?