Kathmandu. Deputy Governor of Nepal Rastra Bank (NRB) Bam Bahadur Mishra has warned that the international financial institutions (FIs) may tighten their transactions with Nepal if Nepal is in the grey list.

He said this while addressing the National Day against Money Laundering, 2082 organized under the theme ‘Prevention of Money Laundering: Transparency and Financial Governance’.

He said that this could not only create serious social and economic problems in the country but also increase the travel of Nepali citizens at the international level, increasing the cost of remittances and other international transactions.

Deputy Governor Mishra said that the international community understands Nepal’s weakness in controlling financial crimes and effective reforms are necessary to overcome it.

On the occasion, Director General of the Department of Money Laundering Investigation Gajendra Kumar Thakur said that the prevention of money laundering was not the responsibility of a single agency but a collective effort of all bodies related to economy. According to him, more than 50 government agencies and more than 80,000 indicator institutions are involved in this sector.

Pointing out the risk of 3 to 5 per cent of GDP being linked to terrorist activities and illegal transactions, Director General Thakur said that Nepal’s economy is still cash-based, the informal economy is large, the modern system has not been effectively regulated, the lack of skilled human resources and technology and the implementation of laws is weak.

Stating that there is a high risk of money laundering in real estate and gold transaction, he pointed out the need of implementation of a risk-based system, legal reform and update, coordination and collaboration among the research bodies, expansion of international coordination, reduction in crimes through modern technology, development of integrated information sharing system, regulation of digital economy and control of cybercrime.