You can spend dollars on ChatGPT, Canva or Netflix, but investing the same amount in global stocks is illegal. Here’s why Nepal Rastra Bank won’t let you invest abroad.

If you’ve ever run a Facebook ad, bought a Netflix subscription, or used ChatGPT to help with your work, chances are you’ve interacted with international services that require payment in US dollars. And thanks to Nepal Rastra Bank’s dollar card system, it’s possible to make these payments within limits.

But here’s where it stops making sense:
You’re allowed to spend a few hundred dollars abroad each year. But try putting that same amount into Apple shares, a US mutual fund, or your cousin’s startup in London, and suddenly, you’ve crossed the legal line.

In other words, Nepal’s rules allow you to consume the global economy, but not participate in it. You can stream, subscribe, and shop online, but investing? Off-limits.

So why does Nepal Rastra Bank draw such a sharp line between spending and investing? 

Why can the diaspora invest globally, but people living in Nepal just can’t? 

And how are small businesses and freelancers coping with this contradiction?

This article unpacks the current laws, the logic behind them, how citizens are finding workarounds, and whether Nepal should consider a more progressive model like India’s Liberalised Remittance Scheme.

But first, let’s break down what is legally allowed today, and where the roadblocks begin.

What You Can Do with Foreign Currency as a Nepali Resident

Nepal Rastra Bank does provide a few legal ways for citizens to access and spend foreign currency. These include two main tools: the dollar card and the travel exchange facility.

1. Dollar Card – Capped at $500 per Year

If you need to make international payments (like subscribing to Spotify, paying for a design tool, or running an ad campaign), Nepali banks offer a dollar card. This is a prepaid Visa card, and it can be either physical or virtual.

The dollar card is convenient for:

• Paying for global platforms like Netflix, ChatGPT, Google Ads, or AWS
• Making purchases on sites like Amazon or Alibaba
• Buying software, web hosting, and other online services

But there’s a limit: you can’t spend more than $500 a year on it. That applies to both individuals and businesses.

So even if you run a tech company and need multiple subscriptions to run your operations, you're stuck with the same $500 cap. And using multiple cards under different names to get around this limit? That might be common in practice, but it isn’t officially allowed under Nepal Rastra Bank’s rules.

2. Travel Exchange – Up to $2,500 per Trip

If you’re planning to travel abroad (excluding India), you’re allowed to exchange up to $2,500 per trip. This facility is meant for covering expenses like your hotel, food, transportation, and other travel costs.

It’s a separate allowance from the dollar card and is only available if you present the proper documents, like a valid passport, visa, and travel ticket. But this money is for travel only. You’re not allowed to use it to buy foreign stocks or invest in businesses while you’re abroad.

So between the dollar card and the travel exchange, you can do quite a bit. Shop, stream, study, and travel. But there’s a clear line: you’re not supposed to use any of these facilities to invest.

The Law Still Says “No” to Investing Abroad

This brings us to the core issue.

According to current law, if you’re a Nepali resident, you are not allowed to invest abroad. Not in stocks, not in real estate, definitely not in crypto or bitcoin, and not even in a friend’s startup overseas.

The section 3 of the Foreign Investment Prohibition Act, 2021 spells it out clearly:

“No citizen is allowed to make any kind of investment outside Nepal unless the government explicitly allows it through a formal notice.”

And that kind of permission? It hasn’t been granted to individuals. 

That said, there’s been a small but significant update.

Registered IT companies in Nepal can now invest up to 50% of their three-year average export income abroad.

But, this exception applies only to registered IT companies.

If you're a freelancer or salaried professional earning in foreign currency, you can legally receive sweat equity (shares offered as compensation for your work) but you still can’t invest your own money abroad, even if that money was earned in dollars.

Section 4(3) the Foreign Exchange Regulation Act, 2019 adds another layer to this. 

It says that if you get foreign currency for one purpose, like travel or online purchases, you can’t legally use it for anything else. If you do, it’s considered a violation. There are fines and penalties involved, even for small amounts.

In short, the law draws a firm line: Nepali residents can use dollars to consume, but not to invest. This means even small, sensible investments, like putting aside a few hundred dollars into foreign mutual funds or buying a few shares of a global company, are completely off-limits.

It’s a rule that doesn’t reflect how modern economies work, especially for a growing number of Nepalis who work in tech, freelance internationally, or are just looking for better ways to grow their savings.

When the Rules Don’t Work, People Find Workarounds

Let’s say you run a small startup in Nepal. You’ve got a team, a decent product, and big ambitions. To grow, you need tools like AWS for hosting, ChatGPT for writing code or content, Figma for design, and Zoom for remote meetings.

You do the math. Just these four subscriptions can easily cost you over $1,000 a year.

But here’s the problem:

Nepal Rastra Bank only lets you spend $500 a year on your dollar card. 

And yes, that $500 limit applies to your entire company, not just you.

So what do people do?

• They ask friends or family abroad to make the payments.
• They use informal remittance channels like hundi.
• Or they go through resellers, people who charge a little extra to “handle it” for you. We’ll talk about this later in the article.

But because these payments go through unofficial routes:

• There’s no proper invoice.
• You can’t show it in your accounts.
• And you can’t claim it as a business expense.

It’s a lose-lose.
The business owner can’t grow properly. The country loses transparency. And Nepal Rastra Bank never even sees the transaction.

The Diaspora Can Invest. You Can’t.

This is where Nepal’s investment rules get tricky.

If you're a Nepali citizen living abroad, you might be investing in global stocks, real estate, or startups without thinking twice. Many have started and grown their business. But if you're living in Nepal, the law says you can't legally invest a single rupee abroad, even if you earn in foreign currency. So, why does this discrimination exist just based on where you reside? 

And this isn’t just policy. It's the law.

Section 1(2) of the Foreign Investment Prohibition Act, 2021 states:

“This Act shall apply to all Nepali citizens, whether residing within or outside Nepal, and to all institutions established in Nepal.”

In simple terms: if you're a Nepali citizen or you run a business registered in Nepal, you're bound by this law, no matter where you are in the world.

But things are a bit more complicated in real life.

If you’re part of the Nepali diaspora and a legal resident of another country, say the US or Australia, your financial transactions fall under that country’s laws. If you invest abroad using foreign-earned income, you're not affecting Nepal’s foreign exchange reserves. That’s why Nepal Rastra Bank generally doesn't interfere in those cases.

But if you’re living in Nepal and want to convert Nepali rupees into dollars to invest abroad, that’s a different story. It puts pressure on the country’s foreign currency reserves, something Nepal Rastra Bank actively tries to protect.

So even though both people hold the same passport, the rules are completely different depending on where they live.

If you're abroad, you can invest freely and build global wealth.
If you're in Nepal, your options are mostly limited to local shares, real estate, or fixed deposits.

It’s not that the system is trying to hold anyone back. It’s just built around one question: where is the money coming from, and where is it going?

But for everyday people trying to plan their financial future, that distinction feels unnecessarily strict. And more than anything, it feels outdated.

Nepal Rastra Bank Talks About Progress. But the Rules Haven’t Changed.

Back in 2019, there was a glimmer of hope.

Nepal Rastra Bank’s then-governor, Maha Prasad Adhikari, openly said that the ban on foreign investment by Nepali residents was outdated. He promised to change it.

Fast forward to today, nothing happened.
No new rule. No policy reform. Just silence.

Meanwhile, Nepal Rastra Bank continues to talk about launching a central bank digital currency (CBDC), while still enforcing a blanket ban on cryptocurrency, even as the rest of the world figures out how to regulate and innovate with it.

Compare that with our neighbors:

• Bhutan quietly grew its crypto reserves to an estimated $1.3 billion by thinking long-term and planning smartly.
• India rolled out its Liberalised Remittance Scheme (LRS) years ago. Today, every Indian resident can legally invest up to $250,000 per year in foreign assets. Stocks, real estate, startups, you name it.

India didn’t just talk about being global, it gave its citizens the tools to participate.

Nepal? We’re still deciding whether we trust our people enough to invest $1,000 abroad.

India Has a System That Works. Could Nepal Try Something Similar?

Let’s take a quick detour to India for a moment.

India’s central bank, the Reserve Bank of India (RBI), introduced something called the Liberalised Remittance Scheme, or LRS for short. It’s been around for years and has become a globally respected system.

Here’s how it works: Every Indian resident individual is allowed to send up to USD 250,000 per year abroad.

No prior approval required. No begging for permission. Just a clean, legal process.

And what can people do with this money?

• Invest in foreign stocks, real estate, mutual funds, or startups.
• Pay for education, medical treatment, or even emigrate.
• Travel abroad. Send gifts. Support family overseas.

It’s a system that says: “We trust you to manage your own money responsibly.”

But it’s not a free-for-all.

There are rules to keep things in check:

If you send more than ₹10 lakh in a year, a 5% tax is collected at source (TCS), which you can adjust in your income tax filing.
You can’t pool multiple people’s LRS limits to invest jointly in assets. (It’s allowed for travel, though.)
And if you don’t end up using the money, you’ve got 180 days to bring it back.

So, Could This Work in Nepal?

That’s the big question.

On the surface, an LRS-style model sounds like exactly what we need. A clean, legal way for people to invest abroad. No loopholes. No shady transfers. Just simple financial freedom.

And there are some clear benefits:

1. It would encourage legal transactions instead of pushing people to go underground.
2. It would help Nepalis diversify their investments, especially those in tech or export businesses.
3. It would promote financial literacy, as more people start exploring global markets.

But of course, there are challenges too.

Nepal isn’t India. Our foreign exchange reserves are smaller (around $12.7 billion as of mid-2024). And we’re heavily reliant on remittances, which make up nearly 30% of our GDP.

Plus, Nepal Rastra Bank doesn’t yet have the systems in place to track outbound investments the way RBI does. That means if we opened the floodgates too quickly, it could strain our reserves or allow misuse.

What Could a Nepali Version of The Indian LRS Look Like?

We don’t need to copy-paste India’s LRS overnight. But Nepal has already taken a small but important first step by allowing export-based IT companies to invest abroad.

So, what could be the next step?

• Expand the scope to include freelancers, startup founders, and high-earning professionals who also earn foreign currency legally.
• Set an initial outbound investment limit for individuals. Something manageable, like $10,000 to $20,000 per year, maybe?
• Introduce a tax tracking system, something like TCS in India, to ensure transparency and monitor flows.
• Roll it out gradually, and build up compliance and reporting infrastructure before allowing larger volumes or wider access.

In other words, we don’t need to fear liberalization. We just need to do it right.

The Underground Resale Market: Filling the Gap or Widening It?

By now, you might be wondering:
“If the dollar card limit is so low, how are so many people still using Netflix, ChatGPT, AWS, and all these tools?”

The answer: resellers.

There’s a booming shadow market in Nepal where local vendors buy bulk subscriptions to global platforms using their dollar cards, or their friends’ or relatives’ cards, and then resell them to others.

Need Netflix? There’s someone on Facebook or TikTok selling shared plans.
Want ChatGPT Plus or Canva Pro? You’ll find resellers who offer “lifetime deals.”
Even AWS credits and domain renewals? There’s someone who can “arrange it” for you.

These resellers are not criminals. They’re responding to market demand. People and businesses in Nepal want global services. But because of strict limits, they can’t access them legally.

So this market fills the gap.

But it raises a bigger question for Nepal Rastra Bank:
Is this clever adaptation by citizens, or a sign of failed regulation?

The truth is, if people are bypassing the system at scale, the system probably needs to change.

A Nation of Savers, With Nowhere to Go

Let’s zoom out for a second.

What happens when you’re a middle-income earner in Nepal, saving money every month, trying to be financially responsible, but you have almost nowhere meaningful to invest it?

Here are your current options:

• Stock market (NEPSE): Volatile, limited liquidity, few sectors represented
• Real estate: Expensive, slow to sell, highly speculative
• Fixed deposits : Safe, but barely keep up with inflation

And what’s not allowed?

• Cryptocurrency: Banned completely
• Gold as an investment asset: Not possible yet!
• Foreign stocks, ETFs, startups, or real estate: Still illegal for residents

In short, Nepalis are expected to save, but not allowed to grow.

And that’s the heart of the problem. In a world where financial opportunity is increasingly global, we’re still stuck with policies built for a different era.

Final Thoughts

Nepal doesn’t lack ambition. We’ve talked about becoming a digital economy, boosting exports, empowering startups, and embracing fintech.

But in reality, we still don’t let our citizens invest $1,000 in a foreign mutual fund.

We let people open a dollar card.
We let them travel and exchange $2,500 per trip.
We let businesses use Facebook ads and Canva (up to a point.)

But the moment someone wants to invest, not just consume, we shut the door.

Why?

Because the system wasn’t designed for a world where a 22-year-old Nepali developer earns in dollars, pays rent through Khalti, and wants to invest in a startup in Singapore.

The question isn’t whether Nepal is ready for outbound investment.
The question is whether Nepal Rastra Bank is ready to trust its citizens.

Trust that some of us want to invest legally.
Trust that global access doesn’t mean capital flight.
Trust that a controlled, transparent system is better than letting everything leak through the cracks.

We’re not saying remove all limits. We’re saying: start with a better one.

Start where it makes sense; just like IT exporters, maybe see if this system works for freelancers, as they’re already bringing money in.

Build systems that track and verify. Introduce tax safeguards. Monitor flows.

Because here’s the thing: the world has moved on.
And if Nepal wants to build a future-ready economy, it can’t keep running on rules from 50 years ago

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