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Current TopicsWhy are Indian issued international debi...
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shelly cameron

| Updated on March 3, 2019 | news-current-topics

Why are Indian issued international debit cards not valid for foreign exchanges in Nepal and Bhutan? http:--goaustraliadaycom

1 Answers
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Mayank Gupta

@mayankgupta5585 | Posted on March 3, 2019

The answer, according to me, lies in the government decision of demonetization. So as you know the govt one night decided to demonetize the Indian currency. So what happened after the demonetisation is lot of people were able to replace the old tender with the new currency as described in the RBI news that 99.9% of the old currency is returned with the RBI.

Before coming to the answer you should know that each country keeps in its reserve some portion of foreign currency be it USD, Euro, Pound, etc. Likewise Nepal govt has Indian currency in its reserve. But after the demonetization the old currency is of no use. So Nepal govt asked the Indian Govt to change the old currency with the new legal tender. But the currency which is left with the Nepal government in its reserve is still not exchanged which amounts in some thousands crore.

Even after the repeated requests, the same has not yet been done due to some glitches as stated in a newspaper. So what Nepal Govt has decided is that it will not keep ₹500 and ₹2000 curenecy notes in its reserve and also these higher denomination currency will not be accepted and will not be legal tender in Nepal. Thus up to ₹200 is legal tender in Nepal.

So, there is a problem of full convertibility of currency in Nepal. So this could be a reason that the debit cards are not valid for foreign exchanges in Nepal.

The other reason could be that the companies issuing debit nd credit cards such as Visa, MasterCard, Rupay, etc come under the preview of the e-Commerce entity and thus are regulated by the e-commerce policy and rules of the country. The recent changes in the e-commerce policy may have temporarily caused the problem of currency exchange.
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