January 6, 2023 | Investopaper
Nepal Rastra Bank has increased the paid-up capital requirement for the company that wishes to operate payment service. Now, the paid-up capital of the company has to be Rs. 80 crores in order to receive the license of the payment service operator.
As per the new provision, payment service providers and operators have to maintain a paid-up capital of Rs. 5 crores to Rs. 80 crores. According to the regulations issued by the Nepal Rastra Bank in 2073, payment service providers required a paid-up capital of between Rs 1 crore to Rs. 5 crores. Similarly, the paid-up capital of payment service operators was from Rs. 10 crores to 30 crores.
Now, the paid-up capital for payment service providers is fixed at Rs. 5 crores to Rs. 25 crores. The minimum capital required for the payment service operator is Rs. 40 crores. However, a minimum capital of Rs. 80 crores has been set for companies that operate payment service outside Nepal through payment instruments issued in Nepal.
A telecommunication service provider company willing to act as a payment service provider through a subsidiary company must submit a commitment to provide non-discriminatory access to telecommunication services and fees to other payment related organizations when submitting an application for letter of intent-permission.
However, if non-discriminatory access is not provided, the license granted by the bank to the subsidiary company of the telecommunication service provider may be cancelled.
There is a provision that an organization that has submitted an application for a license to perform payment-related activities or an organization that currently holds a license can bring in investment from foreign firms, companies or organizations with the approval of the Central Bank. Such investment cannot exceed 15 percent of the paid-up capital of the licensed organization.
An organization that has received a foreign investment permit must issue shares to the general public within three years from the date of approval of such investment, and in the case of a new organization, from the date of obtaining the permit.