Researching Currency in Nepal
You’re planning the adventure of a lifetime and want to find out everything there is to know about your destination. Rightly so! One of the biggest matters to wrap your head around when travelling to a new destination is the currency - what it is, how it is broken down, what denominations you might need and where to withdraw cash.
Perhaps you’re researching hiking in Nepal, visiting the Himalayas or have decided on something more specific like an Everest base camp trek. Whatever trip your adventurous heart leads you to in Nepal, you can be certain you’ll need to understand Nepali currency, how to keep your money safe and what types of payments are accepted throughout the country.
What is the currency of Nepal?
The Nepalese rupee (NPR) is the official currency of Nepal, issued by the Nepal Rastra Bank. It’s abbreviated as Rs or रू and is divided into 100 paisa. Originally called the Mohru by Nepali people, the Nepali rupee was introduced in 1932 and replaced the silver mohar at a rate of 2:1. Before the shift to Nepali rupees, the silver mohar and Nepal’s coinage varied according to various rulers who issued coins in different denominations throughout their reign. The adoption of the Nepalese rupee standardised the country’s currency, enhanced trade, and brought the nation’s currency in line with international norms by implementing a decimal system and ensuring issuance through a centralised authority.
The Nepal Rastra Bank later strengthened the rupee’s stability further by pegging it to the Indian rupee. This facilitated a fixed exchange rate to a more stable currency and reduced currency fluctuations and inflation. Today, the Nepal exchange rate experiences small daily fluctuations like many other established currencies, so keep your eye on it before and while you’re travelling. xe.com has a handy currency converter app for travellers, where you can check various rates such as UK pound to Nepali rupees or US dollar to Nepalese rupees, etc.
You might also be curious about Nepalese currency denominations. NPR is divided into 100 paisa, although with such a small value, these coins are now rarely used. Rupee coins are available in 1, 2, 5, and 10 denominations. Banknotes are issued in 1, 2, 5, 10, 20, 25, 50, 100, 250, 500, and 1,000 rupees. Two interesting facts about Nepal currency: after the monarchy was abolished in 2008 and the nation changed to a republic, all notes were redesigned to showcase Mount Everest and national symbols instead; each denomination of Nepalese banknotes has a distinct colour and size to help visually impaired individuals distinguish between them easily.
Money in Nepal - what’s the best method of payment?
You’ll find that cash is the most widely used form of payment in Nepal, especially in rural areas. But this doesn't mean you shouldn’t carry payment cards on you. Planning and understanding how to use Nepalese money before your trip is key and will help you feel more confident when travelling around the country.
Because of the increasing number of Nepal holidays and travellers visiting Nepal, more businesses are gradually adopting card payment systems or EFTPOS (contactless) machines. You’ll find them most commonly in premium hotels or restaurants. Take note, though - if you do find somewhere that accepts card payments, you can expect to pay an additional 4-10% in fees on top of the bill. Card payments are pretty much non-existent in rural areas, so ensure you have enough cash, in all denominations (small coins and banknotes), before setting off on any cross-country Nepal hikes.
Overall, having a mixture of cash and cards to pay with is the best idea. Using cash for the majority of payments (even where card payments are accepted) will help you avoid racking up charges. But having payment cards gives you extra security for an eventuality
in which large or unexpected payments are required, eg, early or later flights home, emergency accommodation, etc. They also enable you to withdraw cash when needed if you don’t want to carry large amounts and prefer to withdraw what you need as you go. If possible, having a Mastercard and a Visa is ideal as different machines may accept different card types.
Advice on tipping and haggling in Nepal
While we’re on the matter of paying for stuff in Nepal, we thought it would be helpful to include a section about this…
There are some places in which bartering and haggling are commonplace, such as local stalls selling souvenirs, clothing, jewellery or homewares. If you do decide to haggle, keep it lighthearted and friendly. Don’t offend the vendor with a silly offer or be offended if they don’t budge on a price. Remember that a couple of pounds or dollars probably doesn’t mean much to you, but may make a huge difference to the vendor's takings for the day - so use discretion but don’t be ripped off either! Shopping around should give you a fair idea of what things should actually cost.
Tipping in Nepal is pretty standard and should always be allowed for within your budget. Bigger restaurants or teahouses will usually include a 10% service charge on your bill, while smaller places won’t, but it’s still expected and polite, as a traveller to the country.
Where to exchange currency in Nepal
Since the Nepali rupee is a closed currency, you’ll need to either plan to withdraw cash from an ATM or bank when you arrive, or take cash and use an exchange service. If you choose to exchange, you will have a few options:
Banks
Major banks in Nepal, such as Nepal Rastra Bank, Nabil Bank, and Himalayan Bank, offer reliable currency exchange services at standard rates. Most banks operate from Sunday to Friday, with limited hours on Fridays. But be advised that there is a lot of bureaucracy involved with exchanging money in a bank. Forms to fill out, ID required, etc. If you feel more secure doing it within a bank, then be prepared for it to take longer and factor that into your plans.
Authorised money changers
Licensed and government approved money exchange counters are widely available in Kathmandu, Pokhara, and tourist areas. They offer competitive rates and are often more convenient and faster than banks. They usually have a board at the front that lists the day's exchange rate. Most of them copy each other, so it’s pointless trying to bargain or haggle to try and get a better price as they won’t budge on this. Also worth knowing is that the rates charged by money changers aren’t quite as good as at the banks.
Airport
Currency exchange counters are available at Kathmandu Airport (Tribhuvan International Airport). It’s a handy place to exchange a small amount for immediate expenses, but rates may be less favourable than in the cities or tourist spots, so if you plan to exchange a large amount, you’ll get a better deal when you arrive at one of these places.
Where can I withdraw cash when I’m travelling in Nepal?
ATMs
You’ll easily find ATMs in the larger cities and towns such as Kathmandu and Pokhara. But don’t expect them in remote areas - you should plan to have enough cash ready before travelling to these areas. Banks like Nabil Bank, Standard Chartered, Himalayan Bank, and Everest Bank have ATMs that accept Visa, Mastercard, and other international cards.
Most ATMs have a withdrawal limit of NPR 10,000 to NPR 35,000 per transaction, with fees ranging from NPR 400 to NPR 500 per withdrawal. Find out what your own bank charges for withdrawals in Nepal as well, if you’re on a tight budget and need to manage your costs.
Something to be aware of regarding ATMs in Nepal is that they are frequently out of service, so be prepared to try a couple before you find a working one. Look out for ATM lounges, which are spaces that host multiple ATMs - a handy convenience for this reason!
Banks
If you want the feeling of security to make a larger withdrawal, visiting a bank is a good option. Banks will offer over-the-counter cash withdrawals using international debit or credit cards. But remember to carry your passport and any additional ID for verification. As mentioned above, you should also be prepared for a longer transaction in a bank because of the paperwork they require.
Currency Exchange Counters
Some money exchange counters also provide cash withdrawal services, but they may charge higher fees, so they’re probably not the ideal choice for a cash withdrawal in Nepal, but may be handy if it’s your only option.
Final thoughts on money in Nepal
Educating yourself about fundamental aspects of countries you’re travelling to, such as the currency and how to obtain and exchange it, is never a waste of time. Being prepared helps reduce anxiety and puts you in a more confident place before travelling.
Bear in mind that cash is most certainly king in Nepal, and while ATMs are widely available, it’s certainly better to get all the cash you need ahead of any trips or treks, especially to rural areas or the Nepal mountains.
ATMs will typically give you worse exchange rates compared to plain old cash, exchanged at a money changer or bank. The combined ATM fees from Nepali operators, bank fees in your home country, and not necessarily optimal exchange rates used by your home bank all mean that taking cash with you and changing it while there is probably the cheapest option for obtaining Nepali rupees.
Kandoo are experts on travelling and trekking in Nepal. We can help you with advice about money and staying safe on your trip to Nepal. If the idea of trekking Nepal beckons, chat with our friendly team about what we offer - excitement is guaranteed!