Travellers heading to Nepal this holiday season may soon get some relief. The Himalayan nation is set to lift its nearly decade-long ban on high-denomination Indian currency, allowing the use of ₹200 and ₹500 notes up to a specified limit.
The decision follows recent regulatory changes in India and is expected to ease travel, tourism, and cross-border trade between the two countries.
Nepal will allow individuals to carry Indian banknotes of ₹200 and ₹500, with a maximum cap of ₹25,000 per person. The revised rule applies to both Nepali and Indian citizens travelling between the two countries.
Once the decision is officially published in Nepal’s Gazette, the Nepal Rastra Bank (NRB) will issue a circular, after which the new rule will come into effect.
The restrictions date back to India’s 2016 demonetisation, when old ₹500 and ₹1,000 notes were withdrawn from circulation.
At the time, around ₹5 crore worth of Indian currency remained stuck in Nepal’s banking system and could not be exchanged. Citing concerns over invalid and counterfeit currency, Nepal later imposed a ban on Indian banknotes above ₹100 — including the newly introduced ₹200 and ₹500 notes.
The ban had practical consequences. Tourists, traders, and migrant workers were forced to carry large amounts of low-denomination cash, increasing the risk of theft, fines, and detention.
Indian tourists also faced spending limitations, affecting hotels, casinos, and businesses in border towns that depend heavily on cross-border visitors.
The policy shift follows an amendment by the Reserve Bank of India to its Foreign Exchange Management regulations. The revised rules allow Indian, Nepali, and Bhutanese nationals to carry higher-denomination Indian currency up to ₹25,000 while travelling to and from India.
After India eased its restrictions, Nepal’s cabinet approved a similar framework.
The decision will become legally effective once:
Until then, travellers are advised to follow existing currency rules.
The move is expected to simplify cross-border travel, improve cash handling for migrant workers, and support tourism and trade between India and Nepal — especially during peak travel seasons.
