Kathmandu. Electronic medium payment service providers have been attracted to remittance services as well as insurance services in search of alternative ways to expand their business.
In particular, digital payment service providers who have become familiar with the insurance sector’s character and the size, potential and vulnerabilities of the insurance sector by joining hands with the insurance company for the purpose of providing renewal premium collection services of insurance companies are eager to enter the insurance service.
Among the electronic payment service providers, ISEWA has been the first to get approval from the National Bank of Nepal (NBN) to act as an insurance agency by mentioning its management letter in the regulations.
The rest of the service providers are also preparing to get the management letter regulations approved by the NRB by including the issue of providing services of insurance agencies in the management letter regulations.
As Nation Bank is the main regulator of payment service providers, they must first obtain consent from Nation Bank. If there is any other body that has to get permission to provide any service after getting the consent, then it is necessary to enter the process of getting the license only in the second stage.
After the NRB gives its consent, the PSPs have to apply to the the Insurance Board to institutional agency’s license. The promoter, board of director or manager of the applicant institute must obtain the agency training to obtain the license.
Some groups of professional agency have also obtained the institutional agency’s license and have started serving as an organized agency service providers for the potential clients.
According to the Directive 2078 on Institutional Insurance Agents issued by the Insurance Committee on June 10, banks and financial institutions, money transfers, digital payment service providers, cooperatives and other institutions can obtain agent’s license from the committee after completing certain procedures to act as institutional agents.