Nepal to Amend Payment and Settlement Act 2018 to Strengthen Digital Transactions
The Ministry of Finance has drafted the “Payment and Settlement (First Amendment) Act, 2025” to update Nepal’s payment laws, addressing gaps in the 2018 Act and supporting digital finance, inclusion, and innovation.
Nepal’s government is moving to modernize its payments framework by amending the Payment and Settlement Act 2018, aiming to strengthen digital transactions, financial inclusion, and innovation.
The Ministry of Finance has drafted the Payment and Settlement (First Amendment) Act, 2025, citing ambiguities and technical weaknesses in the existing law that risked creating challenges in interbank payments, real-time settlements, and e-wallet services.
The amendment seeks to:
Define “technology service providers” as firms offering IT systems or software for payments.
Allow foreign firms with operations in at least 10 countries to apply for licenses from Nepal Rastra Bank (NRB) to provide payment services in Nepal.
Establish a National Payment Board chaired by the NRB Governor, with members including the Finance Secretary, Auditor General, Deputy Governor, Chair of the Nepal Telecommunications Authority, and an expert nominated by the government.
The government expects the reform to not only make payment systems faster and safer but also expand access for women, marginalized groups, and rural communities. Officials said the updated law would align with Nepal’s commitments to the Sustainable Development Goals, fostering innovation, infrastructure development, and economic growth.
Currently, the Payment and Settlement Act empowers NRB to license, regulate, and supervise payment system operators and service providers. The amendment aims to provide clearer provisions and adapt to Nepal’s fast-evolving digital finance landscape.