But despite years of efforts, officials said the volume of income that workers formally remit back home remains so low that Nepal Rastra Bank (NRB) tags it as ´almost nil´ when compared with other countries.

The formal workers´ remittance transfers barely stand at a billion rupees, though we estimate it should have been around Rs 50 billion, said an NRB official. 

 

Then what´s preventing Nepali workers from remitting money through formal banking channel?

For long, NRB believed it is solely due to lack of awareness among Nepali workers in India. But a recent finding of Reserve Bank of India (RBI) suggests that NRB´s perception is not completely true.

 

Fewer Nepalis workers in India have been remitting money through National Electronic Funds Transfer (NEFT) -- a formal transfer system put in place in India -- also because of lack of awareness of staff members of Indian banks dealing with Nepali workers, RBI has stated.

 

“It is true the number of Nepali making use of this service is low. But it is also learnt that a large number of already low level of money transfer transactions done by Nepalis in India are getting rejected at the pooling branch of State Bank of India -- through which transfers are made -- due to incorrect contents of message,” RBI has noted.

 

For instance, some of the banks providing money transfer services were found putting actual account number of Nepali beneficiary instead of SBI central pool account -- the main account through which the transfers are cleared. Likewise, the dealing staffers of banks too were widely found filling up the format provided for such transactions in a faulty manner.

 

As such mistakes by bank staffers have been affecting timely receipt of money by families back home, even the Nepali workers making use of the service have been shifting to informal channels to remit their income.

Following such finding, RBI has recently issued a strict instruction to the banks in India that have been operating NETF-enabled branches to create awareness among the branch officials about the application. “The bank officials must be aware so that they could guide the Nepali customers, many of who may be illiterate,” RBI has said in its instruction.

 

RBI has also instructed the banks to ensure that the dealing officials exercise correct knowledge and necessary care while making the data entry in the system so as to avoid rejection of the payment requests at SBI Pooling Branch. 

 

Furthermore, it has also instructed banks to make tangible efforts to increase awareness of Nepali workers in India toward their money transfer services and enhance its usage.

“Branches, especially those situated in areas with sizeable migrant Nepali population, are advised to organize periodic workshops and awareness campaigns about the money transfer schemes,” RBI has said in its directives.

 

In this connection, RBI has even suggested that the banks solicit help of Nepali workers´ association for wider disseminations of information about the service.

 

The fresh instruction from RBI came mainly as a part of an understanding, which it has reached with NRB, to facilitate and promote formal transfers of workers income to Nepal. Nepal had made similar request during the recent visit of Prime Minister Dr Baburam Bhattarai as well.