The central bank is launching the real time gross settlement system – to help ease settlement of online payment – in mid-September. “The central bank plans to launch the real time gross settlement system on September 15,” confirmed the central bank.
The real time gross settlement system is a fund transfer system in which money is moved from one bank to another in real time and on a transaction by transaction basis, which means there will be no waiting period. The real time gross settlement transactions can also be carried out between individuals via a legal framework. It is typically used for high-value transactions or urgent transactions that require and receive immediate clearing, according to the central bank.
“Once the system is activated, digital payment service providers will be incorporated in the system and they will be issued a separate licence to operate in the country,” according to the central bank. “Currentlym several digital payment service providers have been operating without being linked to the country’s payment system – which has led to revenue leakage and misappropriation of foreign currency – in the absence of a real time gross settlement system.
According to the central bank, real time gross settlement helps prevent risk by integrating digital payment settlement in its account before payment is passed to the collecting bank.
The central bank had – in April – banned accepting payment via AliPay and WeChat Pay – China’s most popular mobile payment platforms – as they have not been registered with the central bank. The central bank has termed the payments illegal as they were not incorporated in the country’s tax system, and Nepal was losing foreign income due to illegal use of these payment applications by Chinese tourists.
The central bank has after the incident is working – in collaboration with the Nepal Telecommunications Authority (NTA) – to introduce regulatory policies for digital financial service providers. The real time gross settlement system will help monitor all the payment systems, and payments of value added tax (VAT), income tax and excise duty can be made digitally.
Though, the payment system was under full control of banks and financial institutions (BFIs) until 2009, the operation of eSewa digital wallet in 2009, has changed the scenario of payment as customers can pay, send and receive money from their mobile phones and also over the internet even without a bank account. Apart from eSewa, there are many digital wallet products including Khalti, IME Pay, 4Enet Pay and I-Pay, currently.
Globally the central banks are facing the challenge to devise a mechanism to track payment settlement due to increasing number of digital payment service providers. Nepal Rastra Bank (NRB) – the central bank of Nepal – also was forced to bring Nepal Payment System Development Strategy with the aim of launching the real time gross settlement system.
Though, Nepal Clearing House was established as a public limited company in December 2008 to digitise cheque clearing services, it also looks after multiple payments, clearing and settlement systems. Apart from facilitating electronic cheque clearing services, it provides automated clearing house services in the form of the Interbank Payment System (IPS).
Fllowing the implementation of the real time gross settlement system, the clearing house will serve as an intermediary to enable banks to initiate and process transactions between the real time gross settlement system and its internal system, the central bank claimed, adding that the real time gross settlement system will help minimise systemic settlement risk in particular.
The real time gross settlement system is a fund transfer system in which money is moved from one bank to another in real time and on a transaction by transaction basis, which means there will be no waiting period. The real time gross settlement transactions can also be carried out between individuals via a legal framework. It is typically used for high-value transactions or urgent transactions that require and receive immediate clearing, according to the central bank.
“Once the system is activated, digital payment service providers will be incorporated in the system and they will be issued a separate licence to operate in the country,” according to the central bank. “Currentlym several digital payment service providers have been operating without being linked to the country’s payment system – which has led to revenue leakage and misappropriation of foreign currency – in the absence of a real time gross settlement system.
According to the central bank, real time gross settlement helps prevent risk by integrating digital payment settlement in its account before payment is passed to the collecting bank.
The central bank had – in April – banned accepting payment via AliPay and WeChat Pay – China’s most popular mobile payment platforms – as they have not been registered with the central bank. The central bank has termed the payments illegal as they were not incorporated in the country’s tax system, and Nepal was losing foreign income due to illegal use of these payment applications by Chinese tourists.
The central bank has after the incident is working – in collaboration with the Nepal Telecommunications Authority (NTA) – to introduce regulatory policies for digital financial service providers. The real time gross settlement system will help monitor all the payment systems, and payments of value added tax (VAT), income tax and excise duty can be made digitally.
Though, the payment system was under full control of banks and financial institutions (BFIs) until 2009, the operation of eSewa digital wallet in 2009, has changed the scenario of payment as customers can pay, send and receive money from their mobile phones and also over the internet even without a bank account. Apart from eSewa, there are many digital wallet products including Khalti, IME Pay, 4Enet Pay and I-Pay, currently.
Globally the central banks are facing the challenge to devise a mechanism to track payment settlement due to increasing number of digital payment service providers. Nepal Rastra Bank (NRB) – the central bank of Nepal – also was forced to bring Nepal Payment System Development Strategy with the aim of launching the real time gross settlement system.
Though, Nepal Clearing House was established as a public limited company in December 2008 to digitise cheque clearing services, it also looks after multiple payments, clearing and settlement systems. Apart from facilitating electronic cheque clearing services, it provides automated clearing house services in the form of the Interbank Payment System (IPS).
Fllowing the implementation of the real time gross settlement system, the clearing house will serve as an intermediary to enable banks to initiate and process transactions between the real time gross settlement system and its internal system, the central bank claimed, adding that the real time gross settlement system will help minimise systemic settlement risk in particular.
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