With increasing digitisation and mobile penetration in Nepal, more and more people now have access to the internet. Digital advancement can make life simpler and easier, with internet businesses striving to provide hassle-free and time and cost-effective services. Many economists surmise that the economy of the future is going to be digital with even currency moving online. In Nepal too,  digital wallets like eSewa and Khalti are providing online payment services that are making things easier. However, these services are limited and they aren’t as widespread as they should be. While we are able to use these digital wallets to pay our water and electricity bills, we still cannot use them to pay for other services like share brokers’ payments and tax payments. Most businesses also do not accept digital payments yet.  

However, a new platform called Connect IPS has now emerged. This new platform aims to establish a national payment gateway to facilitate electronic payments and financial transactions within the country. This includes government payments, credit card bill payments, and share brokers payments.

What is Connect IPS?

The Connect IPS e-Payment system serves as a standardised single payment platform to facilitate online fund transfers (person-to-person), government revenue payments (customer–to-government), creditor payments (customer-to-buyer) and payment processing (e-commerce) with all payments processed directly from-and-to bank accounts. There will be no need to park your funds in an intermediary platform like eSewa or Khalti for fund transfers or bill payments. 

The platform can be accessed through its website and a dedicated mobile app. However, there is a limit on the per-day transaction amount. As of now, the per-transaction limit for online payment via Connect IPS is Rs 5,000 through the mobile application and Rs 100,000 through its website.

Connect IPS was conceived and developed by Nepal Clearing House Limited (NHCL), which has been guided and promoted by Nepal Rastra Bank. The company also received support from other banks and financial institutions (BFI).  Since its launch on October 28, 2018, the platform is supported by 44 BFIs, among which 32 are already in operation. 

Why Connect IPS?

Connect IPS is an easy and hassle-free medium to perform any sort of electronic payments directly through the bank. This platform can also be used for fund transfers during purchase or procurement of goods. Additionally, all transactions carried out on the platform are entirely encrypted. Connect IPS is ISO 270001 certified, ensuring the protection of its users’ information. 

Furthermore, as the platform was introduced and promoted with the involvement of almost all major banks and financial institutions in Nepal along with the central bank, it can be regarded as reliable and trustworthy.

How to get started?

Electronic payments can be made directly through bank accounts without using any intermediary platforms. But to get started with Connect IPS, an account needs to be created at www.connectips.com. This is as easy as making a Gmail or Facebook account—there are no special procedures. 

Signing up requires the user’s name, date of birth, a valid email address and phone number. The phone number and email address will be used as authentication keys for account validation and also for every transaction that happens through the platform. After providing these details, the website will direct the user to enter a unique username, password and answers to security questions, as is usual. An account is then created. 

After the creation of the account, the user needs to provide their bank information for the account that they wish to link to Connect IPS. The bank will then verify the linkup to ensure that account holder is aware of this connection. For verification process, the user will need to fill out an identification form and visit the bank for authorisation. Once the bank issues a green signal, users are good to go. 

Online tax payment

Usually while making tax payments, people have to line up in long queue at a government office for a long time. And there are several governmental procedures involved while paying taxes. But making payments via Connect IPS is easy and hassle-free. First, the user needs to visit the website www.rajaswa.fcgo.gov.np and log in. After providing all the information asked on the website and making a new voucher, the user needs to select the ‘Connect IPS’ option on the payment menu. After doing so, the website will redirect to the Connect IPS website where the user can input their username and password. After that, a one-time password (OTP) will be sent to the user’s mobile number and email address. After entering the OTP on the website and clicking on the submit button, the user can then recieve the tax voucher. 

Connect IPS appears to be an easier digital payment system than eSewa or Khalti since it does not require an intermediary. However, not many businesses support Connect IPS for payments yet, even if government services might. In any case, the development and support of such a payment gateway by a government entity itself bodes well for the future of digital payments in Nepal.