Kathmandu, Nepal. In a significant step towards enhancing cross-border financial services, the Nepal Rastra Bank (NRB) has granted permission to HDFC Bank Ltd., one of India’s leading private sector banks, to operate Direct Foreign Banking Services (DFBS) in Nepal. This initiative will be conducted in partnership with Mahalaxmi Bikas Bank Ltd., a prominent development bank in Nepal.
This is the first-ever approval under the Foreign Banking Service Policy 2082 introduced by NRB, allowing a foreign bank to operate financial services in Nepal without establishing a physical branch.
Scope of Services
Under this partnership, HDFC Bank will offer a wide range of digital cash and trade management services in Nepal, including:
Cash Management Service (CMS)
Electronic Cash Management Service (e-CMS)
NEFT (National Electronic Funds Transfer)
RTGS (Real Time Gross Settlement)
FT (Fund Transfer)
These services will enable efficient cross-border cheque collection, electronic payments, and financial operations for individuals and institutions involved in trade, remittance, and corporate payments between Nepal and India.
Strategic Collaboration
HDFC Bank will not open a physical branch in Nepal. Instead, it will deliver its services through Mahalaxmi Bikas Bank, which will act as a local partner platform. This model is known as Service-Based Operation, where a foreign bank utilizes the infrastructure and presence of a local bank to operate.
This move aims to facilitate faster and more transparent financial transactions, especially benefitting:
Export-import businesses
Corporate clients
Nepali workers abroad sending remittances
New Product and Expansion
To mark this milestone, HDFC Bank has launched a specialized product under the label “Direct Foreign Banking – Nepal Entity”. The bank has also initiated outreach efforts to promote this service as a convenient solution for cross-border financial needs.
With this collaboration, HDFC Bank has become a pioneer in implementing digital cross-border financial solutions in Nepal, reinforcing India-Nepal economic ties.
Summary:
HDFC Bank is the first foreign bank to be authorized for direct banking services in Nepal.
It will operate digitally and in partnership with Mahalaxmi Bikas Bank.
The services focus on cross-border transactions, remittances, trade, and cash management.
The move is seen as a step toward regional financial integration and digital transformation in Nepal’s banking sector.
