Nepal bans Chinese digital wallets
Nepal has restricted its favored Chinese digital wallets Alipay and WeChat Pay, to avoid the loss of foreign currency earnings from tens of thousands of Chinese tourists. The country is losing foreign currency earnings through usage, the reason for the ban on Alipay and WeChat Pay. The country is losing foreign currency, and anyone who will be found using the platforms will face the consequences. More than 150,000 Chinese holidaymakers visited Nepal last year, several of them using digital wallets to pay in hotels, restaurants and outlets in traveller areas – particularly in Chinese-run businesses.
Laxmi Prapanna Niroula, an interpreter for the country’s financial institution stated that Nepal was losing out since the actual transactions took place in China. Nepal is among the poorest and least developed countries within the world, with one-third of its population living below the personal income. A landlocked country with rugged geographics, few natural resources and poor infrastructure, over 80% of the population is mostly rural based. Last year Nepal welcomed more than a million tourists for the first time.
Tourism could also be a significant revenue earner for impoverished Kingdom of Nepal, home to eight of the world's 14 peaks over 8,000 metres.Tourism contributed 7.8 % to Nepal's Gross Domestic Product (GDP) in 2017, producing over a million jobs, according to the World Travel and Tourism Council. A street in Thamel has even earned the name Chinatown as a result of the high range of Chinese-run hotels and restaurants. Sushil Koirala, who runs a tea shop in Thamel, Kathmandu’s main tourist area said that “Chinese tourists often ask for digital payment options. With the ban, individuals are guaranteed to lose businesses.”
Once these intermediaries acquire operation, they're going to route payments created using WeChat Pay and Alipay through Nepali banks, helping Nepal register those payments as foreign financial gain. Although these intermediaries begin subsiding payments, illegal use of Chinese digital wallets can not be dominated out as a result of those applications permit peer-to-peer transactions. This implies that Chinese tourists visiting Nepal and Chinese nationals operating businesses in Nepal will forever send cash to every alternative bypassing the intermediator. This can solely be prevented if the Chinese payment companies deploy technology referred to as geofencing to trace whether or not Chinese nationals are making payments using the formal channel, or keeping with consultants within the field of digital payment. This way, payments created by Chinese nationals, who have bypassed the formal channel, are often blocked.