In August 2021, the Reserve Bank of India announced an increase in limit for fund transfer to Nepal under the ‘Indo-Nepal Remittance Facility Scheme’ to ______ per transaction w.e.f. 1 October 2021.
₹2 lakhs
RBI Indo-Nepal Remittance Facility Limit Increase Explained
The question asks about the specific increase in the limit for fund transfers to Nepal under the Indo-Nepal Remittance Facility Scheme, announced by the Reserve Bank of India (RBI) in August 2021.
Understanding the key details of the question:
- Scheme: Indo-Nepal Remittance Facility Scheme
- Purpose: Fund transfer to Nepal
- Authority: Reserve Bank of India (RBI)
- Announcement Date: August 2021
- Effective Date: 1 October 2021
- Change: Increase in the limit per transaction
In August 2021, the RBI announced several measures related to payment systems. One of these announcements specifically concerned the Indo-Nepal Remittance Facility Scheme. To facilitate smoother and larger value transactions between India and Nepal, the per-transaction limit was increased.
Let's look at the options provided:
- ₹50 thousand
- ₹2 lakhs
- ₹75 thousand
- ₹1 lakh
Based on the RBI's announcement made in August 2021, effective from October 1, 2021, the per-transaction limit under the Indo-Nepal Remittance Facility Scheme was revised upwards.
The previous limit per transaction under this scheme was ₹50,000. The RBI decided to significantly increase this limit.
The new limit set by the RBI for fund transfers to Nepal under the Indo-Nepal Remittance Facility Scheme, effective from 1 October 2021, became ₹2 lakhs per transaction.
Therefore, the correct option representing the increased limit is ₹2 lakhs.
Key Points about the Indo-Nepal Remittance Facility Scheme
- It is a scheme for cross-border remittances from India to Nepal.
- It is a unique arrangement between the central banks of India and Nepal (RBI and Nepal Rastra Bank).
- Remittances can be sent through NEFT (National Electronic Funds Transfer) originating from bank branches or other channels in India that are NEFT-enabled.
- The recipient in Nepal can receive the funds in Nepalese Rupees through various modes, including credit to their bank account or payment in cash at designated locations.
Summary of the Limit Change
| Aspect | Details |
|---|---|
| Scheme Name | Indo-Nepal Remittance Facility Scheme |
| Effective Date of Change | 1 October 2021 |
| Previous Limit (per transaction) | ₹50,000 |
| New Limit (per transaction) | ₹2 lakhs |
| Announced By | Reserve Bank of India (RBI) |
| Announcement Month/Year | August 2021 |
Revision Table: Indo-Nepal Remittance Facility
Let's quickly revise the crucial details:
- What scheme? Indo-Nepal Remittance Facility.
- What was changed? Per-transaction limit for sending money to Nepal.
- When was it announced? August 2021.
- When did the change start? 1 October 2021.
- What is the new limit? ₹2 lakhs per transaction.
Additional Information: Remittance Facilities
Remittance facilities are essential for people working abroad or across borders to send money back home. The Indo-Nepal Remittance Facility is a specific example of such a system designed for the unique relationship and needs between India and Nepal. Increasing limits like this can help facilitate trade, tourism, and support families by allowing larger sums to be transferred more efficiently.
The use of systems like NEFT for these international transfers highlights the integration of domestic payment systems with cross-border arrangements.
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