Nepal has lifted its ban on Indian Rs 200 and Rs 500 currency notes, a restriction in place since 2016. Individuals can now carry up to Rs 25,000 in these denominations when travelling between the two countries.
In a move that will bring relief to travellers and traders, Nepal has lifted its long-standing ban on carrying high-denomination Indian currency notes. Rs 200 and Rs 500 notes can now legally be brought into the country, nearly a decade after restrictions were imposed following India's demonetisation in 2016.
The decision is being seen as a practical step to support the close economic and people-to-people ties shared by India and Nepal, which have an open border and frequent cross-border movement.
How Much Cash Can You Carry?
While the ban has been lifted, Nepal has made it clear that limits will continue to apply. According to government spokesperson and Minister for Information Technology and Communication Jagdish Kharel, individuals will be allowed to carry Indian currency worth up to Rs 25,000 per person when travelling between the two countries.
"This provision applies to both Nepalese and Indian citizens," Kharel said, adding that the same limit applies whether one is entering Nepal from India or returning.
Only Valid Notes Will Be Accepted
The Nepal government has also clarified that only Indian currency notes issued after November 9, 2016, will be allowed. Notes that were demonetised during India's currency overhaul will remain invalid and cannot be used.
This clarification is significant, as many people in Nepal were left holding Indian currency when demonetisation was announced, with limited options to exchange it.
Why the Ban Was Introduced in the First Place
Nepal had restricted Indian currency notes above Rs 100 after India withdrew high-value notes in 2016. The move was aimed at preventing the circulation of invalid currency and protecting Nepal’s financial system from uncertainty.
At the time, an estimated Rs 50 million worth of Indian currency was held within Nepal's banking system, much of which is still yet to be exchanged.
RBI's Role in the Policy Shift
The easing of rules follows changes made by the Reserve Bank of India (RBI), which amended the Foreign Exchange Management Regulations, 2015. These amendments allowed the import and export of high-denomination Indian currency between India and Nepal, clearing the way for Kathmandu to relax its restrictions.
Why This Decision Matters
For many living along the India–Nepal border, Indian currency is part of daily life. Allowing Rs 200 and Rs 500 notes again is expected to make travel, tourism and small-scale trade smoother.
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