Currency and Payments

The Nepali rupee (Rs) is divided into 100 paisa (p). There are coins for denominations of one, two, five and 10 rupees, and banknotes in denominations of one, two, five, 10, 20, 50, 100, 500 and 1000 rupees. Since the abolition of the monarchy in 2008, images of Mt Everest have replaced the king on all banknotes.

Away from major centres, changing a Rs 1000 note can be difficult, so it is always a good idea to keep a stash of small denomination notes.

Standard Chartered Bank has 24-hour ATMs in Kathmandu and Pokhara. Other banks, such as Himalaya Bank and Nabil Bank, have ATMs and are present in most reasonable sized towns, but some don't accept foreign bank cards (despite Visa signs indicating that they do). Quite a lot of machines seem to have a per-transaction withdrawal limit of Rs 15,000, but there doesn't appear to be any rhyme or reason as to which machines do and don't. Fess are around Rs 500 per withdrawal.

Frequent power outages can limit the machines’ working hours, so use one when you see it’s working. Using an ATM attached to a bank during business hours will minimise hassle in the rare event that the machine eats your card.

Inform your bank that you’ll be using your card in Nepal, otherwise they might suspect fraud and freeze your card.

Official exchange rates are set by the government’s Nepal Rastra Bank and listed in the daily newspapers. Rates at the private banks vary, but are generally not far from the official rate.

There are exchange counters at the international terminal at Kathmandu’s Tribhuvan Airport and banks and/or moneychangers at the various border crossings. Pokhara and the major border towns also have official money-changing facilities, but changing travellers cheques can be time consuming elsewhere in the country, even in some quite large towns. If you are trekking, take enough cash in small-denomination rupees to last the whole trek.

The best private banks are Himalaya Bank, Nepal Bank and Standard Chartered Bank. Some hotels and resorts are licensed to change money, but their rates are lower. Travellers cheques from the main companies can be exchanged in banks in Kathmandu and Pokhara for a 2% surcharge. Euro travellers cheques are also charged a flat US$10 fee per cheque. With each passing year it gets harder to change cheques.

When you change money officially, you are required to show your passport, and you are issued with a foreign exchange encashment receipt showing your identity and the amount of currency you have changed. Hang onto the receipts as you need them to change excess rupees back into foreign currency at banks. You can change rupees back into foreign currency at most moneychangers without a receipt.

Many upmarket hotels and businesses are obliged by the government to demand payment in hard currency (euros or US dollars); they will also accept rupees, but only if you can show a foreign exchange encashment receipt that covers the amount you owe them. In practice this regulation seems to be widely disregarded. Airlines are also required to charge tourists in hard currency, either in cash US dollars, travellers cheques or credit cards, and this rule is generally followed.

In addition to the banks, there are licensed moneychangers in Kathmandu, Pokhara, Birganj, Kakarbhitta and Sunauli/Bhairawa. The rates are often marginally lower than the banks, but there are no commissions; they have much longer opening hours (typically from 9am to 7pm daily) and they are also much quicker, the whole process often taking no more than a few minutes.

Most licensed moneychangers will provide an exchange receipt; if they don’t you may be able to negotiate better rates than those posted on their boards.

Major credit cards are widely accepted at midrange and better hotels, restaurants and fancy shops in the Kathmandu Valley and Pokhara only. Most places levy a 3% to 4% surcharge to cover the credit card company’s fees to the vendor.

Branches of Standard Chartered Bank and some other banks such as Nabil Bank and Himalaya Bank give cash advances against Visa and MasterCard in Nepali rupees only (no commission is charged), and will also sell you foreign-currency travellers cheques against the cards with a 2% commission.

In general, it’s easiest to send money through companies such as Western Union (www.westernunion.com) or Moneygram (www.visitnepal.com/moneygram), which can arrange transfers within minutes. To pick up funds at a Western Union branch, you’ll need your passport and 10-digit transfer code.

Note that money can often only be received in Nepali rupees, rather than US dollars.

• Taxis Round up the fare for taxi drivers; rickshaw drivers will also appreciate a modest tip.
• Restaurants Tipping waiting staff is uncommon, but tips are invariably appreciated.
• Guides & Porters Trekking guides and porters generally expect a tip of 10% to 15% for a job well done.

For current exchange rates see www.nepalrastrabank.com