Nepalis opening accounts in Indian banks in droves

KOHALPUR, Feb 16:

Though existing laws prohibit Nepalis from opening a bank account in India, many people living in border areas are opening accounts in different Indian banks by producing recommendation letters issued by their respective village development committees (VDCs).

Nepali students and workers residing in India, however, can open accounts in Indian banks by following due procedures like furnishing letters from their university or employers and other necessary documents. However, Indian banks allow Nepalis to open bank accounts if they produce a recommendation letter from local administration. Locals of many households of the bordering VDCs are opening accounts in nearby Indian banks as Nepali banks and financial institutions are not present in their area.

Locals of around a dozen bordering VDCs are opening accounts in various Indian banks like Central Bank of India, Punjab National Bank, Grameen Bank, Sahara Bank and Allahabad Bank, among others.

Niraj Singh of Jamunaha recently opened an account in Sahara Bank´s Rupaidiha branch. "Many Nepalis visit Rupahidiha every day to open bank accounts in Indian banks. Apart from a recommendation letter in Hindi or English produced by the local administration, we need to provide just a copy of citizenship certificate and a photograph to open the account," he added.

Locals of Jaispur, Hirmaniya, Holiya, Radhapur, Sitapur and Sonpur, among other VDCs, are opening their bank accounts in India. VDC offices and ward offices of Nepalgunj Sub-Metropolitan City easily provide recommendation letters in Hindi and English languages as per the request of the locals.

Salauddin Ansari, coordinator of Jaispur-based ward office of Nepalgunj Sub-metropolitan City, said almost each household of Jaispur area have accounts in Indian banks. "Though we are not authorized to issue such recommendation letters, locals press us to do so," he added.

Secretaries of bordering VDCs say most of the locals in their area have been doing transactions through Indian banks for the past many years.

According to Nepal Rastra Bank´s Nepalgunj Office, an average of Rs 740,000 is deposited to Indian banks from Banke district every day.

Rishiraj Gautam, secretary of Hirminiya VDC, told Republica that they have been issuing such recommendation letters in Nepali language. Such letters are translated into English by notary offices, he added.

"We are issuing recommendation letter despite knowing that we are not authorized to issue such letters," he said, adding that his office do not maintain record of such letters.

Bhishma Uprety, manager of Nepal Rastra Bank´s Nepalgunj Office, said only the Nepalis working or studying in India can open bank account there. "Nepalis are not allowed to open accounts in Indian banks. VDC offices are also not authorized to issue such recommendation letters," he said, adding, "It is wrong to issue recommendation letters that allow Nepalis to make transaction in foreign currency.”

Source: Republica