Nepal Remittances Reach Rs 436.36 Billion as New Labour Approvals Fall and Prices Rise

More Money Arrives as Fewer Workers Seek New Approvals

Nepal received Rs 436.36 billion in remittances during the first two months of fiscal year 2026/27, an increase of 23.9 percent from a year earlier, according to Nepal Rastra Bank figures released on October 15, 2026. Money sent home from abroad continued to grow even as the number of workers receiving new approval for foreign employment fell.

The inflows included Rs 221.31 billion during the second month, from roughly mid-August to mid-September. In dollar terms, remittances reached $2.85 billion over the two months, up 13.5 percent. Remittances are money that people working abroad send home, often to help relatives pay for food, school, healthcare and savings.

The same economic update showed two developments affecting how far that money can go. Nepal's foreign exchange reserves rose to Rs 4,065.78 billion by mid-September, strengthening its capacity to pay for imports. Consumer inflation, meanwhile, climbed to 6.34 percent, with food and beverage prices rising faster.

For families, the story is therefore about both income and expenses. More money was entering Nepal, while everyday purchases were becoming more expensive. For the country, the rising inflows supported foreign currency holdings during a period when imports were also growing.

How the Two Months Fit Together

Nepal Rastra Bank's first month report, dated September 18, 2026, provides the starting point. Its Current Macroeconomic and Financial Situation of Nepal recorded Rs 215.05 billion in remittances through mid-August, up 21.2 percent from the corresponding month a year earlier.

The fiscal year's opening month ran from July 17 to August 16. Adding the next month's Rs 221.31 billion brings the total to Rs 436.36 billion. The sequence is:

• Mid-July 2026: Foreign exchange reserves stood at Rs 3,897.67 billion at the start of the fiscal year.
• July 17 to August 16: Remittances reached Rs 215.05 billion.
• Mid-August to mid-September: A further Rs 221.31 billion arrived.
• September 18: The central bank dated its report covering the first month.
• October 15: The figures covering the first two months were released.

The September publication covers one month, while the October update extends the economic picture through mid-September.

The Second Month Added Momentum

Remittances in the second month were Rs 6.26 billion higher than in the first, an increase of about 2.9 percent. The second month supplied just over half of the total received during the opening two months.

Compared with the same month a year earlier, the change was larger. Inflows rose from Rs 174.67 billion to Rs 221.31 billion, an increase of Rs 46.64 billion, or about 26.7 percent. That helped lift cumulative growth from 21.2 percent after the first month to 23.9 percent after two months.

These comparisons answer different questions. The 2.9 percent increase measures the movement from one month to the next within the current fiscal year. The 26.7 percent increase compares the second month with its equivalent a year earlier. The headline 23.9 percent figure compares the combined opening two months across the two fiscal years.

The figures show that both months contributed substantial inflows, with the later month adding a slightly larger amount.

Why Rupee and Dollar Growth Differ

Remittances grew by 23.9 percent when measured in Nepalese rupees and by 13.5 percent when measured in US dollars. The difference matters because the value of money changes when it is expressed in another currency.

Exchange rates affect the rupee value assigned to money arriving from abroad. A transfer can therefore show a different rate of growth in rupees than in dollars. Households generally meet local expenses in rupees, while dollar figures help describe Nepal's capacity to make international payments.

The central bank's first month figures showed a similar gap: remittances increased by 21.2 percent in rupees and 10.2 percent in dollars, reaching $1.40 billion. By the end of the second month, the cumulative dollar total had risen to $2.85 billion.

Dollar growth was slower than in the corresponding opening two months of the previous fiscal year, when it reached 27.6 percent. The current 13.5 percent increase was 14.1 percentage points lower. Nepal was receiving more money in dollar terms, but the pace of annual growth had eased.

The current total of $2.85 billion and the 13.5 percent growth rate imply a prior-year two-month total of about $2.51 billion, calculated by dividing $2.85 billion by 1.135. This is an estimate based on the rounded figures, not a prior-year total quoted in the available material.

New Approvals Fall While Re-entry Approvals Rise

A total of 78,320 workers received final labour approval for new foreign employment during the first two months, down from 90,198 a year earlier. That was a decline of 11,878 approvals, or about 13.2 percent.

Re-entry approvals moved in the opposite direction. They increased to 52,163 from 45,884, a rise of 6,279, or about 13.7 percent. This category covers approval for workers returning to employment abroad.

Adding the two categories gives 130,483 approvals, compared with 136,082 a year earlier, a decrease of about 4.1 percent. Re-entry approvals accounted for roughly 40 percent of the combined total, up from about 33.7 percent. Returning workers therefore made up a larger share of the approval activity.

The shift was already visible in the first month. New approvals numbered 42,693, down from 44,466, while re-entry approvals rose to 27,748 from 23,644.

Remittances can keep growing while new approvals fall because workers already overseas also send money home. Approvals measure permission to work abroad during a particular period; remittances include transfers from a much wider population of workers. The central bank figures do not provide a breakdown showing how much of the increase came from earnings, transfer patterns or changes in the number of senders.

Foreign Currency Reserves Build Up

Nepal's gross foreign exchange reserves rose by Rs 168.11 billion between mid-July and mid-September, from Rs 3,897.67 billion to Rs 4,065.78 billion. The central bank put the increase at 4.3 percent.

In dollars, reserves rose by 4.6 percent, from $25.31 billion to $26.48 billion. Indian currency accounted for 21.3 percent of the total in mid-September, compared with 21.8 percent a month earlier.

Foreign exchange reserves are holdings of foreign currency and related assets available to the central bank and banking system. They help a country meet international payment needs, including payments for imported goods and services.

By mid-September, Nepal's reserves were sufficient to cover 17 months and 24 days of goods and services imports, according to the central bank's calculation. Its first month report had estimated coverage at 18.8 months, when reserves stood at Rs 3,946.23 billion.

Import coverage depends on both the size of reserves and the import bill used in the calculation. A country can accumulate more reserves while the estimated number of months of coverage falls if the import spending used to measure coverage rises.

Trade Figures Explain the Need for Foreign Currency

Nepal's first month trade figures show why incoming foreign currency matters. Merchandise imports reached Rs 187.44 billion, an increase of 31 percent from a year earlier. Exports rose faster, by 61.7 percent, but from a much smaller base, reaching Rs 38.70 billion.

The resulting merchandise trade deficit was Rs 148.74 billion, up 24.9 percent. A trade deficit means the country spent more on goods bought from abroad than it earned from goods sold overseas. Exports covered 20.6 percent of imports, compared with 16.7 percent a year earlier.

Petroleum products, chemical fertilizer and edible oil were among the imports that increased. Such purchases connect the external accounts to daily life through transport, farming and food supplies.

Remittances provided a large inflow alongside that spending. In the first month, they totalled Rs 215.05 billion, compared with the Rs 148.74 billion merchandise trade deficit. The current account, which brings together trade, services, income and transfers, recorded a surplus of Rs 94.59 billion. The broader balance of payments recorded a surplus of Rs 90.34 billion.

Those surpluses show that Nepal received more than it paid out across the transactions covered by those accounts during the month, helping explain the increase in foreign assets.

Higher Prices Put Pressure on Family Budgets

Consumer inflation reached 6.34 percent in mid-September, compared with 1.87 percent a year earlier. Food and beverage inflation stood at 7.54 percent, while prices for non-food items and services rose by 5.69 percent.

The annual inflation rate had already reached 5.96 percent in mid-August. It then increased by another 0.38 percentage points over the following month. Inflation measures how much the price of a representative basket of purchases has changed compared with the same period a year earlier.

The first month report showed some sharp increases within that basket. Ghee and oil prices rose by 15.62 percent, fruit by 15.39 percent and transport by 13.17 percent. These are expenses that can absorb part of the money families receive from relatives abroad.

Price pressures also varied by location. In mid-August, annual inflation was 6.94 percent in Madhesh Province and 4.61 percent in Sudurpashchim Province. Rural inflation stood at 6.18 percent, compared with 5.88 percent in urban areas.

For a household receiving remittances, purchasing power depends on the amount it receives and the prices it faces. Families spending a large share of their budget on food may experience a different squeeze from those with other spending needs.

Banking Figures Show a Mixed Domestic Picture

Nepal's first month banking figures showed a small decline in deposits alongside a modest increase in lending. Deposits at banks and financial institutions fell by Rs 20.71 billion, or 0.3 percent, to Rs 8,256.21 billion. Credit to the private sector increased by Rs 23.58 billion, or 0.4 percent, to Rs 5,880.64 billion.

Over the preceding year, deposits had grown by 14.5 percent and private sector credit by 7 percent. The annual growth rates were therefore stronger than the changes recorded during the opening month itself.

Commercial bank interest rates were lower than a year earlier. Their weighted average deposit rate stood at 3.15 percent, down from 4.02 percent, while the lending rate fell to 6.48 percent from 7.76 percent. Lower lending rates reduce interest costs for borrowers whose loans reflect those rates, while lower deposit rates reduce the return paid to savers.

The central bank also injected Rs 101.87 billion into the financial system through net purchases of $665.8 million during the first month. When it buys foreign currency and pays rupees in return, it adds rupee funds to the banking system. This is one concrete connection between incoming foreign exchange and money circulating at home.

Key Points

• Nepal received Rs 436.36 billion in remittances during the first two months of fiscal year 2026/27, up 23.9 percent.
• Dollar inflows increased by 13.5 percent to $2.85 billion, implying a prior-year total of about $2.51 billion based on the rounded figures; the prior-year growth rate was 27.6 percent.
• The second month contributed Rs 221.31 billion, compared with Rs 215.05 billion in the first.
• New foreign employment approvals fell to 78,320, while re-entry approvals rose to 52,163.
• Foreign exchange reserves reached $26.48 billion, covering 17 months and 24 days of goods and services imports.
• Consumer inflation reached 6.34 percent in mid-September, with food and beverage inflation at 7.54 percent.