Fiscal Nepal
First Business News Portal in English from Nepal
KATHMANDU: In a major policy tightening aimed at strengthening financial transparency and combating money laundering, the government has lowered the ceiling for cash transactions to Rs 500,000. Any payment, sale, purchase, or financial exchange exceeding this amount must now be routed through the banking system starting Magh 1, according to Land Management Minister Anil Sinha.
The Cabinet meeting held on Monday endorsed the new compliance rule, replacing the previous threshold of Rs 1 million. With this revision, the government seeks to curb illicit transactions, boost digital payment culture, and align Nepal with international anti–money laundering standards—an issue closely tied to Nepal’s ongoing pressure under the grey list framework.
Minister Sinha stated that the move is crucial to strengthening Nepal’s position in the global financial monitoring system. “To further improve our anti–money laundering framework and reduce risks highlighted in the grey list assessment, the government has decided that transactions above Rs 500,000 must be conducted through the banking channel,” he said.
Under the new provision, any transaction—whether for goods, services, or other financial activities—exceeding the Rs 500,000 mark must be completed through banks or financial institutions. The government believes this will promote accountability, document trail, transparency, and improved monitoring of large-value payments.
The decision carries significant implications for sectors like real estate, automobiles, construction materials, wholesale trading, and luxury retail, where high-value cash deals have remained common. It is also expected to enhance Nepal’s digital economy, support formal financial flows, and improve the business environment—elements crucial for foreign direct investment (FDI), fintech growth, compliance reforms, and global economic standards.
The government has also decided to mark Bhadra 23 as Gen-Z Day, acknowledging the growing civic and social influence of Nepal’s younger generation.
This policy shift aligns with Nepal’s broader efforts toward economic reform, financial discipline, transparency, and alignment with global governance norms—key SEO-linked elements such as economic policy, banking regulation, digital payments, AML compliance, Nepal business environment, investment climate, and financial governance that increasingly shape domestic and international commentary on Nepal’s economy.
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