The Role of Digital Payment Systems in Facilitating Remittance Transfers to Nepal

Abstract

Remittances play a vital role in Nepal’s economy, significantly contributing to household incomes and national GDP. The adoption of digital payment systems has transformed the remittance transfer process, offering enhanced accessibility, cost-efficiency, and financial planning opportunities for recipients. Despite these benefits, challenges such as limited digital literacy and trust issues hinder widespread adoption, particularly in rural areas. This study explores the potential of digital payment systems to address these barriers through targeted strategies, including infrastructure development, collaboration between fintech providers and banks, and government-led awareness campaigns. By addressing these challenges, Nepal can unlock the full potential of digital remittance systems, driving financial inclusion and fostering long-term economic development.