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NCHL- IPS FAQs
1. What is an Interbank Payment System (NCHL-IPS)?
A:

NCHL-IPS is a system to safely and efficiently tranfer funds from one account to any other account held at any of the participating member banks & financial institutions (BFIs). It supports account to account payments (Direct Credit) and collection (Direct Debit) related transactions. The underlying transaction products (purpose) of such payments or collections could be customer transfer, fees, insurance premium, loan installment, treasury, salary, pension, social security, dividend, IPO refunds, government payments, etc. 

2. Who regulates NCHL-IPS System?
A:

NCHL-IPS System is approved and regulated by Nepal Rastra Bank.

3. How does the NCHL-IPS system works?
A:

Customer requests or authorizes its bank (called as originating bank) to issue a credit instruction for payment to account(s) held at one or more of the member banks. The originating bank then initiates a direct credit transaction in the NCHL-IPS system and sends to the beneficiary bank (called as receiving bank). The receiving bank acknowledges the transaction and credits the beneficiary account after the settlement confirmation is received from the central bank. The final settlement takes place based on net position of the member banks at the settlement bank.

 

Similarly, customer request of debit instruction for collection from account(s) held at one or more of the member banks, the originating bank generates a debit instruction based on the mandate (consent between creditor and debtor). The receiving bank acknowledges the transaction and debits its customer account. The originating bank’s customer account will be credited after the settlement confirmation is received from the central bank.

4. What are the various products (purposes) supported by NCHL-IPS?
A:

The system supports over 160+ products (purposes). However, the relevant purposes of direct credit and direct debit will be available. Some of the purposes that will be initially introduced are Customer Transfer, Fees, Loan Installments, Interest, Insurance Premium, Remittance, Treasury, Government payments, Salary, Pension, Social Security, Dividend, IPO Refund, etc.

 

The transactions could be one-to-one or bulk transactions. It even supports standing order based payments (direct credit) and mandate based collections (direct debit). Supported currencies are NPR, USD, EUR and GBP, however foreign currency transaction may not be relevant for some of the purposes.

 

5. What are the benefits of using NCHL-IPS System?
A:
  • Alternative payment options other than cash and cheque.
  • Ease of payment and collection directly to/ from any bank account to any other bank account.
  • Supports standing instruction based payments and mandate based collection on pre-scheduled dates resulting into faster access to fund and improved cash flow.
  • Ease of account operation as single account can support multiple purposes from multiple BFIs.
6. What are Direct Credit and Direct Debit transactions?
A:

A transaction initiated by Debtor (payer) through its bank is a direct credit transaction. Creditor will be the receiver of such transaction. Customer has to instruct its bank for such direct credit transaction from its branch or through alternate channel. Examples of direct credit transactions are customer transfer, premium payment, bill/ fees payment, salary/ pension/ social security payments, etc.

 

A transaction initiated by Creditor (payee) through its bank is a direct debit transaction. Debtor will be the receiver of such transaction. An authorization, called as Mandate, has to be in place for initiating a direct debit transaction. Examples of direct debit transactions are premium collection, bill/ fees collection, installment collection, etc.

 

In both Direct Credit and Direct Debit, customers account will not be debited unless you have provided such instruction/ authorization to your bank. 

7. Can I give standing instruction to automatically initiate payment/collection related transactions directly from my bank account?
A:

Yes, Mandate can be setup for automatically initiating direct debit transactions. This will allow the beneficiary through its bank to collect agreed amount directly from your bank account on the specified date/ frequency as agreed between you and the beneficiary.

And Standing Orders can be setup for automatically initiating direct credit transactions. This will allow you through your bank to transfer fund directly to the beneficiary’s account on the specified date/ frequency.

8. From where can I avail the service of NCHL-IPS?
A:

The service is available through any of the banks and financial institutions who are enrolled within the NCHL-IPS system. So, you can avail the service from your bank or financial institution where your account is maintained. Refer to ‘NCHL-IPS Members’ section in our website to ensure that your bank is a member in the NCHL-IPS system.

 

And some of the banks may have integrated their core banking system with NCHL-IPS to provide alternate channels to their customers for initiating transactions.

9. How long does it take for clearing a transaction through NCHL-IPS system?
A:

All transactions received before 1:00 PM are cleared by the system on the same day (T+0). The transactions presented after the cut-off time are cleared and settlement the following day (T+1). Based on the purpose, the transactions could be cleared and settled intermittently. Refer to the NCHL-IPS Session Timings section for details.

 

Customers are required to consult their bank as they may set their own cut-off times for their operational arrangements.

10. What is the information that I need to provide to my bank for initiating a transaction?
A:

Basic information that will be required for initiating a transaction includes your bank account and the receiving party’s bank account details. The purpose of the transaction will also be required. However, your bank may request for additional information like some mandatory reference numbers and others that may be needed for completing the transaction.

 

Customers are required to consult their bank to know about such additional information required.

11. What is a Creditor Listing? Is there easier way of remembering the receiver bank account details?
A:

Bank account details of the beneficiary can be listed in the NCHL-IPS system as creditor listing corresponding to which a creditor code (short alpha numeric code) is assigned that can be used by the initiator of the transaction. The bank will not require to manually input the detail information about the beneficiary if the customer provides the creditor code. It will also be easier for the customer by just providing the creditor code rather than to remember the entire bank account details. Small corporates, schools/ colleges, cable operators, ISPs, etc. can enroll their bank account details and their clients can use for service payments from any of the member banks.

 

Service providers can consult their bank to avail creditor listing facility in NCHL-IPS system. Customers can ask their service provider if they have a creditor code for receiving payments through NCHL-IPS.

12. Are there any fees or charges for availing NCHL-IPS related services?
A:

There will be nominal transactional fee for availing this service levied either to the originator or the receiver of the transaction based on the purpose.

 

Customers can contact their bank for fees and charges related details. 

13. Who should be contacted for further information?
A:

Contact you bank for further information or visit our website www.nchl.com.np.