business

Ministry of Education’s Missing Watch on Consultancies

by Khatapana

Jul 29, 2025 - 10 min read

Ministry of Education’s Missing Watch on Consultancies

Most education consultancies in Nepal operate without a license. Find out how the Ministry of Education’s oversight gap is putting thousands of students at risk.

Walk through Putalisadak on any weekday and you’ll see it for yourself; a forest of backlit signs shouting out names like “Future Abroad,” “Global Gateway,” or “NextGen Study.” These education consultancies are everywhere, promising dreams of Australia, Canada, the UK, and Japan. Just walk in, they say. We’ll handle your application, your visa, your future.

But here’s what most people don’t realize: a huge number of these consultancies are operating completely illegally.

According to data from Nepal’s Department of Commerce, Supplies, and Consumer Protection, more than 5,000 educational consultancies are currently in operation across the country. Out of these, only around 900 have received the required license from Nepal’s Ministry of Education.

The rest? They’ve skipped the one step that actually matters: getting official approval to offer educational consulting services.

And it’s not a minor technicality. This isn’t a case of missing paperwork or delayed renewals. These are businesses actively offering services to thousands of young students, charging hefty fees, making life-changing promises, without ever bothering to get legal permission to do so.

So how did we get here? How are thousands of such businesses operating under the radar in a sector so closely tied to people’s futures?

Let’s start at the beginning: the law.

What Most People Get Wrong About Business Registration

If you’ve ever started a business in Nepal, you’ll know the process begins at the Office of the Company Registrar (OCR). You fill out the forms, submit your documents, pay the fees, and get a shiny certificate that says you now officially own a registered company.

But the incorporation/registration certificate you receive from OCR is not a license to do any business. It’s a mere confirmation of creating a legal business entity. You can take it as the birth of a legal person i.e. the company. And just like a new born human needs education and professional qualifications before they start their career, a company needs further formalities.

Here are some mandatory registrations that every businesses in Nepal are required to obtain after company registration:

Step 1: Register/Incorporate a company with OCR

Step 2: Register the business at Ward Office

Step 3: Obtain tax registration certificate i.e. the PAN certificate

Step 4: Depending on the nature of business of the company (according to the objectives), register at the Department of Commerce (in case of trading, export/import, distribution business, does not involve any value addition activities other than selling) or Department of Industry (in case of all business other than aforementioned and involves value addition)

Step 5: And in certain regulated sectors like hydropower, telecommunication, aviation, health, education,etc., you need to obtain additional approvals and licenses.

Here’s the process of getting an educational consultancy registered.

Most businesses in Nepal, more than 90%, start operating immediately after completing Step 3. Yes, once you obtain your PAN certificate, one can open a bank account and start their operation. And due to lack of monitoring or awareness, business owners do not care about the other steps.

Here is an example: If you want to open a pharmacy, you need approval from the Department of Drug Administration. If you want to run a school, you need permission from the Ministry of Education. The company registration certificate is just a piece of the puzzle, not the full green light.

In fact, Section 4 (2) (e) of the same Companies Act spells this out in specific. It says the company must:

“Obtain prior approval or license if required for any specific business or transaction.”

So if your business is dealing with something that requires government oversight, like sending Nepali students abroad, you can’t just register and start operating. You need a sector-specific license.

Which brings us to the education consultancy business.

The Legal Requirement Everyone’s Ignoring

If you want to legally run an education consultancy in Nepal, there is one place you must go: the Ministry of Education, Science and Technology.

And if you don’t get permission from them, you’re not allowed to offer any of the following services:

Study abroad consulting
Bridge courses
Language preparation classes (like IELTS or Japanese)
Admission support for foreign colleges or universities

This requirement is laid out in Section 16n of the Education Act, 2028, which clearly states:

“No person shall be allowed to conduct educational consultancy services, bridge courses, language teaching classes or any educational program conducted in a foreign country without obtaining permission.”

This is reinforced by the provincial legislation. In line with the same, Bagmati Province has issued the Education Consultancy and Language Directive 2079, and the Ministry of Social Development (“Ministry”) specifically regulates this growing sector.

Here’s what the law says in plain language:

Rule 3: Every education consultancy must obtain a license from the Ministry of Social Development, or from an agency authorized by the Ministry.
Rule 4(2): The license is valid for one financial year. It must be renewed annually by submitting the required documents within 90 days of expiry of the financial year.

If you don’t follow this process, your consultancy is operating outside the law.

But the rules don’t stop at just getting a license. The same directive; particularly Rule 7 outlines what a legally compliant consultancy must do:

Only offer services within the scope of what’s been authorized by the Ministry.
If you’re hiring a foreign national as a counselor or instructor (for example, a Japanese teacher), you must get separate approval for that individual.
You must maintain full transparency on service fees (what you charge, and for what.)
Counselors and instructors must meet qualification standards laid out by the Ministry.

So why are so many education consultancies skipping all this?

Because it's easier to get an OCR certificate, print a banner, rent an office in Putalisadak, and just start operating. Most students and parents never ask to see a Ministry-issued license. And most consultancies are not eager to explain that they don’t have one.

The result? A booming, barely regulated industry, where thousands of young students are trusting their future to businesses that are not legally authorized to guide them.

The Reality on the Ground: Thousands Operating Illegally

You’d think a sector tied so closely to students’ futures would be tightly regulated. But recent inspections have revealed just how far from the law Nepal’s education consultancy business has drifted.

According to the Department of Commerce, Supplies and Consumer Protection, the situation is worse than anyone imagined.

Out of the more than 5,000 education consultancies estimated to be operating across Nepal, only 900 have obtained the mandatory license from the Ministry.

That leaves over 4,100 consultancies running without the legally required approval. That’s more than 80% of the total consultancies currently in the market.

And it’s not just that they missed a deadline or forgot to renew. In most cases, these businesses never applied for a license in the first place. Many assume, or pretend, that registering their business with the Office of the Company Registrar is enough. It isn’t. Without the express permission from the Ministry of Education, these consultancies have no legal right to advise, charge, or enroll students for overseas education.

What the Crackdown Revealed

Starting from 1st Shrawan, the Department intensified its monitoring efforts. In just one week, 55 consultancies were inspected.

The results were eye-opening:

10 consultancies were fined on the spot, totaling NPR 605,000 in penalties.
Another 45 were summoned to the Department with instructions to present all relevant business documents within three days.

Most consultancies were found to be in blatant violation of the rules. Here’s what inspectors uncovered:

No billing system (fees were being collected without issuing receipts or invoices.)
Cash-only, undocumented payments, making it impossible to trace financial dealings.
No written agreements with students, even though the Directive mandates clear contracts before any service begins.
False or misleading advertisements, claiming international affiliations or visa success rates without any basis.

In some cases, consultancies were even offering test preparation classes and language training without the proper infrastructure or qualified staff; again, in clear breach of Ministry guidelines.

What’s worse, many students had no idea they were dealing with unlicensed operators. For parents and families making enormous sacrifices to fund their children’s studies abroad, this lack of transparency can result in wasted time, money, and shattered dreams.

Legal Violations and Penalties

So, what does the law actually say about these violations? Quite a bit, and it’s not vague.

1. Consumer Protection Act, 2075

The Consumer Protection Act was designed to shield individuals from unfair business practices, and the way many consultancies operate today falls squarely into that category.

Under Section 38(k) of the Act, collecting money for services without a valid license or failing to issue proper bills is a punishable offense.
Section 39(1)(d) empowers authorities to fine such offenders between NPR 50,000 and 100,000; immediately, and without needing to go through lengthy court procedures.

This provision is what allowed the Department’s monitoring team to issue on-the-spot fines to dozens of consultancies during the recent crackdown.

These aren’t symbolic penalties. They’re a legal signal that the state is starting to take enforcement seriously.

2. Violations Under the Education Directive

But the more direct legal framework for education consultancies comes from the Education Consultancy and Language Directive, issued by the Ministry.

Operating without a license is a clear breach of Rule 3 of the Directive.
Hiring unqualified staff; or worse, employing foreign nationals without formal approval, violates Rule 7(1)(e).
And as specified by Rule 6, failing to meet any of the obligations outlined in the Directive, such as not providing fee transparency or not having proper physical infrastructure, gives the Ministry grounds to cancel a consultancy’s license entirely.

In practice, however, many of these consultancies don’t even hold a license in the first place. Which means there’s nothing to cancel, only room for penalties or closure.

But enforcement isn’t always proactive. As the system stands today, much of the government’s action still relies on complaints, not routine oversight. That’s slowly beginning to change, but the gap between policy and practice remains wide.

What’s at Stake: Students and Families as Victims

When education consultancies operate outside the legal framework, it’s not the government that suffers, it’s students and their families.

Many of the complaints pouring into the Department of Commerce, Supplies and Consumer Protection paint a disturbing picture of what’s happening behind closed doors. Students are being misled, overcharged, and in some cases, completely abandoned.

One of the most common issues is false promises. Consultancies claim they have guaranteed pathways to universities abroad or “100% visa success,” even when they don’t have any formal partnerships or success history. There are reports of students who were told they had secured admission, only to find out their applications were never even submitted.

Then there’s the issue of counseling fees. Tens of thousands of rupees are being charged, often in cash, without any formal receipts. Students who ask for a breakdown are either brushed off or told it’s part of a package deal. Without proper invoices, there’s no paper trail, and no accountability.

And when things go wrong? Many consultancies simply disappear. Students are left chasing vague promises and disconnected phone numbers.

The most tragic part is that most families don’t even realize they’re being scammed. They see a fancy office, a well-dressed counselor, and assume everything is in order. After all, the business is “registered.” But as we’ve seen, registration without licensing from the Ministry of Education means nothing when it comes to legality and accountability.

For many Nepali families, sending a child abroad for higher education is more than just a personal dream. It’s more of a massive financial risk. In the wrong hands, that dream can quickly turn into a costly heartbreak.

A Broken Enforcement System?

If this problem is so widespread, why hasn’t it been fixed already?

The answer lies in the cracks between the very agencies meant to prevent this mess.

Right now, there is no centralized system that ties together all the approvals and oversight needed to monitor education consultancies effectively. Each agency is working in isolation, and often, passively.

The Ministry of Education, for its part, lacks a comprehensive, public database to track who’s licensed and who isn’t.

Provincial governments may have their own rules for test preparation and training centers, but these aren’t harmonized with federal-level policies.

The Consumer Protection Department, which finally started inspections this year, only gets involved after a complaint is filed.

This means enforcement is reactive, not proactive. Instead of preventing fraud, the system waits for someone to get hurt before stepping in.

And because there’s no shared database or inter-agency communication, it’s extremely easy for unqualified operators to slip through the cracks. A business could register at OCR, start operations the next day, and nobody, not even the Ministry, would know until months or years later.

This fragmented enforcement structure is a key reason why thousands of unlicensed consultancies are able to operate so freely.

Recommendations & Policy Solutions

Fixing this won’t be easy, but it’s far from impossible. The first step is accepting that registration alone doesn’t ensure legitimacy, it’s the sector-specific licensing that matters. Especially when the sector involves guiding young people’s futures.

Here are some policy solutions that could change the game:

1. Scaled Penalties Based on Harm

Fines should be linked to the amount charged to students or the number of students affected, not just a flat NPR 51,000.

Also, Repeat offenders should face suspension and even criminal investigation, especially in cases involving fraud or misrepresentation.

2. Inter-Agency Coordination

The Ministry of Education, Consumer Protection Department, OCR, and provincial governments need to develop a shared framework and enforcement protocol. Additionally, regular joint inspections should become standard, not the exception.

3. Public Awareness Campaign

Students and families must be made aware of their rights. Educational campaigns (online and offline), can inform the public about what licenses to check, what documents to demand, and how to report wrongdoing.

This is a solvable problem. Nepal doesn’t lack laws, it lacks coordination, enforcement, and public awareness. If we can align the systems and empower students to make informed decisions, we can clean up a sector that’s become too comfortable with impunity.

Final Thoughts: Whose Future Are We Risking?

In Nepal, sending a child to study abroad; from what all of us have seen, is a family project. Relatives chip in, loans are taken, land is sometimes sold. So, it’s a high-stakes investment wrapped in hope.

Now imagine placing that hope in the hands of someone who never had the legal right to guide you in the first place.

That’s exactly what’s happening today, in offices across Putalisadak and beyond, where sleek banners and confident sales pitches hide a disturbing truth: many of these businesses are not licensed, not accountable, and not qualified to handle the futures they promise to shape.

In a country where a single visa rejection can crush years of effort, should we really allow anyone with a printer and a logo to sell overseas dreams?

We’re not saying entrepreneurship should be punished. This is about protecting trust, because when education becomes a business, it needs regulation. And when that business involves sending students halfway across the world, the rules can’t be optional.

The laws are already in place. The Ministry of Education has set the conditions. The Consumer Protection Act gives teeth to enforcement. But paperwork alone won’t solve this.

We don’t just need stronger laws.
We need smarter enforcement, better coordination, and above all, more informed consumers.

Families should know what licenses to look for. Students should feel empowered to ask tough questions. And the government must make it easy, and mandatory to check whether a consultancy is truly qualified to offer what it claims.

Until that happens, the overseas dream will continue to be brokered in back offices, built on shaky promises, and paid for with someone else’s future.

Need Help Staying Compliant?

If you're running an education consultancy, or planning to start one, make sure you're doing it right. Navigating licensing and compliance requirements can be complex, but it doesn’t have to be confusing.

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