June 28, 2023
KATHMANDU – Chinese digital payment service WeChat Pay and NMB Bank Nepal have partnered to make the mobile payment system available in Nepal.
The service which launched on Thursday allows Chinese nationals visiting Nepal to pay for their purchases using their mobile sets.
In February 2020, Nepal Rastra Bank had allowed NMB Bank to establish infrastructure and a mechanism to bring WeChat Pay to Nepal. But Covid-19 got in the way and the inauguration was put off.
Chinese Ambassador to Nepal Chen Song tweeted on Thursday, “Warm congratulation to Wechat Pay Cross-border Payment service Inauguration in Nepal. A new step forward in financial connectivity, one of the five “connectivities” under #BRI initiative.”
He also wished for the success of the cooperation between NMB Bank and WeChat Pay to bring more tangible benefits to the two countries.
“The cooperation between NMB Bank and WeChat Pay has legalised payments via WeChat Pay in Nepal,” said Sudesh Upadhyaya, deputy CEO and chief information officer of NMB Bank.
“Chinese nationals visiting Nepal with WeChat Pay on their mobiles can make payment by scanning a quick response (QR) code,” said Upadhyaya.
“For now, the service is available only to Chinese visiting Nepal and not to Nepalis going to China. With Chinese nationals making payment via WeChat Pay, it will help Nepal earn foreign currency.”
In May 2019, Nepal had banned WeChat Pay and AliPay stating that online payments through unregistered systems were illegal and resulted in a loss of income for Nepal.
WeChat Pay, operating on Tencent’s messaging service, and e-commerce giant Alibaba’s Alipay are the two dominant platforms in mainland China.
WeChat Pay, officially known as Weixin Pay in China, is a mobile payment and digital wallet service that allows users to make mobile payments and online transactions.
Nepal has recently agreed with different countries to permit online cross-border digital payment.
On June 1, Nepal and India signed a memorandum of understanding for cross-border digital payment, which is expected to ease transactions for business people, students and tourists from both countries.
The cross-border digital payment service will be available to travellers of both countries reciprocally.
“We are working on technical integration and connection of the system for Nepal-India cross-border digital payment after the discussion with a unified payment interface (UPI) team of the National Payment Corporation of India,” said Neelesh Man Singh Pradhan, CEO of Nepal Clearing House.
On June 1, Nepal’s Fonepay signed a memorandum of understanding with Sri Lanka’s National Payment Network: LankaPay by developing an interoperable digital payment system that enables users to transact seamlessly across the two countries.
The collaboration will allow users of either network’s applications to make payments across merchants of these two networks in either country in an affordable and convenient manner, the company said in a press release.
“In the first phase, we prioritise acquiring for cross-border digital payment, which means allowing foreign nationals to make payment in Nepal using the digital payment mode of their respective countries,” said Guru Prasad Poudel, executive director of Nepal Rastra Bank and chief of the payments department.
“The first phase is also about developing a mechanism so that Nepalis in foreign countries can send money through digital payment services,” Poudel said.
“In the second phase, Nepali nationals will be allowed to make digital payments in their respective countries. For this, limitations need to be determined and charges on transactions also need to be made. The second phase is yet to be implemented,” he said.
According to Nepal Rastra Bank, there were 10 payment system operators (PSOs) and 27 payment service providers (PSPs) in Nepal as of mid-May. There were 13,744 PSP agents and 18.22 million wallet users in the country as of mid-May.
Nepal made electronic payment transactions totalling Rs3.88 trillion from mid-April to mid-May this year, down from Rs5.31 trillion during the same period last year.