NRB streamlines foreign exchange for overseas students, 5% buffer and digital recognition introduced

Kathmandu: Nepal Rastra Bank (NRB) has introduced a new provision allowing students studying abroad to send up to an additional 5 percent of their total required funds. This measure was designed to address potential shortfalls that may arise due to exchange rate fluctuations, ensuring that students have sufficient amounts in US dollars or other convertible foreign currencies despite market volatility.

The central bank implemented this change by amending the ‘Unified Circular-2082’ issued for licensed foreign exchange entities. Beyond the financial buffer, the NRB has also facilitated smoother processes for currency exchange and the validation of digital documentation to better support the needs of the student community.

This facilitation specifically assists students who require foreign currency for visa applications, renewals, or living expenses as mandated by foreign embassies or government agencies. In cases where certain embassies require financial proof in their local currencies, even if those currencies are not officially listed in the NRB’s schedule of convertible foreign exchange, the central bank will now provide exchange facilities based on the submission of necessary supporting documents.

The central bank emphasized that this move is a direct response to the practical difficulties caused by volatile exchange rates. By permitting an additional 5 percent margin on the total requested amount, the NRB ensures that students do not face a deficit if the currency value shifts between the time of the transaction request and the actual transfer of funds abroad.

Furthermore, the NRB has modernized its administrative requirements by granting formal recognition to digital signatures. While the previous regulations generally required the submission of original physical documents, the bank now accepts documentation verified through digital signatures as per the Electronic Transactions Act, 2063. These reforms have been executed under the authority of the Foreign Exchange (Regulation) Act, 2019, and the Nepal Rastra Bank Act, 2058.