Nepal Rastra Bank (NRB) has mandated all Payment Service Operator (PSO) companies to transition into public entities by the conclusion of Fiscal Year (FY) 2027/28.
In a consolidated directive issued on Friday, the central bank has instructed all PSOs to become public limited companies within the forthcoming three years. Presently, Nepalese PSOs have been functioning as private organizations.
The central bank’s latest directive will encompass all businesses involved in the execution, management, and reconciliation of payment operations. The existing PSOs in the nation include FonePay, Connect IPS, Smart Choice Technology, Nepal Clearing House Limited, and Nepal Payment Solution, among others.
These firms offer ATM card services along with mobile banking-based payment solutions. Nepal Clearing House receives investments from Nepal Rastra Bank and a variety of banks and financial establishments. Several of these PSOs also facilitate international payments and transaction reconciliations.
Through the consolidated directive, the NRB has also tightened policies regarding PSOs providing multiple card types to a single client. According to the new regulation, PSOs are prohibited from issuing debit cards, credit cards, and prepaid cards from a single account of one customer.
To effectively enforce anti-money laundering protocols, the central bank has requested PSOs to submit details of their related activities to the Money Laundering Prevention Supervision Division of NRB within two months following the conclusion of the FY.
In addition, PSOs will be required to monitor whether their customers utilize Virtual Private Networks (VPNs) while accessing mobile banking or internet banking services. Warning of rising digital threats, the central bank has directed PSOs not to permit their clients to access digital banking services unless authenticated VPNs are employed. Licensed PSOs must also perform regular Disaster Recovery (DR) drills for payment systems and ensure that all transaction reconciliations occur through authorized settlement accounts in designated banks.
The NRB has kept the cap for maximum transaction amounts unaltered. The daily cap for transactions between bank accounts (including QR) and wallets stands at Rs 200,000, while the monthly ceiling is Rs 1 million. Likewise, the limit on transactions between two wallet platforms remains Rs 50,000 daily, and the monthly cap is Rs 500,000.
