RBI, NRB governors to talk on various issues on Friday in Kathmandu

Reserve Bank of India (RBI) governor Dr D Subbarao is visiting Nepal this Friday in an invitation of central bank governor Dr Yubraj Khatiwada.
"They will discuss issues of mutual interest and also issues relating to their part of the world and global issues," according to the RBI sources.
During his two-day visit, Subbarao is speaking to bankers in Kathmandu on the first day.
"This is basically a courtesy visit by RBI governor on the invitation of NRB governor," informed spokesperson for Nepal Rasta Bank (NRB) Bhaskar Mani Gyanwali. "However, we can expect the governors to discuss the issues of common concern but there is no predetermined agenda for talks."
However, the central bank can be expected to lobby for the permission to opening of branch of Nepali remittance companies in India to increase the inflow of remittance from India.
At present, RBI allows the remittance from India through its Indo-Nepal Remittance Facility that allows Nepali migrants to send up to 50,000 Indian Currency (IC) in a single transaction through its National Electronic Fund Transfer (NEFT) member Indian commercial banks to Nepal SBI Bank's account that then routes the remittance to the receiver through its branches or a designated money transfers.
Despite the existence of the formal remittance facility most of remittance is entering in Nepal through non-banking channels like hundis so that millions of rupees go undocumented.
Thousands of Nepali migrant workers in India are not aware about the money transfer facilities and the informal channels are more in use.
The another issue that might get discussed in the visit is the circulation of Rs 500 and Rs 1,000 denomination Indian currency notes in Nepal. RBI does not accept these currencies from Nepal citing the rise of instances of counterfeit currencies from Nepal. The refusal of higher denomination has caused hassles for Indian tourists who carry cash while visiting Nepal. However, accepting the higher denomination currency from Nepal is not within the singular jurisdiction of Indian central bank as the decision has to be taken by the government.
RBI is also apprehensive about accepting the higher denomination notes from Nepal due to risk of counterfeits in spite of the persuasion from the Nepal Rastra Bank.
Subbarao took over as the 22nd governor of the Reserve Bank of India on September 5, 2008 for a three-year term. Prior to the appointment as RBI governer, he was the finance secretary in the Ministry of Finance, Government of India.