What changed
The per-transaction limit for Indo-Nepal remittances under the NEFT-based scheme has been increased from ₹50,000 to ₹2 lakh. The earlier restriction of a maximum of 12 remittances per remitter per year has been removed entirely. For remittances made in cash by walk-in customers, the old ceiling of ₹50,000 per transaction and 12 per year continues to apply.
What it means for you
Banks can now process larger individual remittances to Nepal, which should boost trade-related payments and person-to-person transfers. The removal of the annual cap simplifies compliance and encourages higher volumes. However, cash-based remittances remain tightly controlled, so banks must differentiate between account-based and cash transactions. This change also supports pension and retirement payments to ex-servicemen settled in Nepal.
What you must do
- Update NEFT system limits to allow per-transaction remittances up to ₹2 lakh for account-based transfers.
- Remove the annual cap of 12 remittances per remitter for non-cash transactions.
- Maintain the existing ₹50,000 per transaction and 12-per-year cap for cash remittances from walk-in customers.
- Implement velocity checks and risk mitigation measures for the higher limits.
- Coordinate with SBI for charges on transactions above ₹50,000 as per their prescribed rates.
Who it affects
All banks participating in NEFT, Remitters sending funds from India to Nepal, Beneficiaries in Nepal receiving through Nepal SBI Bank or agency arrangements, Ex-servicemen settled in Nepal receiving pensions
What is the new per-transaction limit for Indo-Nepal remittances?
The limit has been raised from ₹50,000 to ₹2 lakh per transaction for remittances initiated through NEFT, effective October 1, 2021.
Does the annual cap of 12 remittances still apply?
No, the annual cap of 12 remittances per remitter has been removed for account-based transfers. However, it continues to apply for cash remittances from walk-in customers.
What charges apply for transactions above ₹50,000?
For transactions up to ₹50,000, existing charges as per the 2009 circular apply. For amounts above ₹50,000, the charges prescribed by State Bank of India will apply.