UPSC Prelims Practice Questions — India and Nepal Launch Cross-Border Remittance Mechanism to Strengthen Bilateral Financial Connectivity

Question 1

With reference to the UPI–NPI cross-border remittance mechanism operationalised in June 2026, which one of the following is the Indian entity that executed the technical integration with Nepal Clearing House Limited (NCHL)?

Accepted Answer

NPCI International Payments Limited (NIPL)

Answer

Bharat Bill Payment Central Unit (BBPCU)

Answer

Indian Financial Technology and Allied Services (IFTAS)

Answer

Reserve Bank Innovation Hub (RBIH)

Question 2

As per the Ministry of Finance announcement on the UPI–NPI cross-border remittance corridor, how many participating banks in India are live on the corridor at launch?

Accepted Answer

18

Answer

12

Answer

15

Answer

21

Question 3

The Indo-Nepal Remittance Facility Scheme, conceived as India's first cross-border remittance corridor riding on the NEFT system, was launched by the Reserve Bank of India in which year?

Accepted Answer

2008

Answer

2005

Answer

2011

Answer

2014

Question 4

Under the Indo-Nepal Remittance Facility Scheme, the sole designated bank in Nepal authorised to receive funds remitted from India is:

Accepted Answer

Nepal SBI Ltd. (NSBL)

Answer

Nepal Rastra Bank

Answer

Rastriya Banijya Bank

Answer

Nepal Clearing House Limited

Question 5

Which one of the following best describes the National Payments Corporation of India (NPCI)?

Accepted Answer

A not-for-profit company incorporated under the Companies Act and authorised by the Reserve Bank of India to function as the umbrella organisation for retail payment systems in India.

Answer

A statutory body constituted under the Payment and Settlement Systems Act, 2007 to regulate retail payment systems in India.

Answer

A wholly-owned subsidiary of the Reserve Bank of India established to operate large-value settlement systems and government securities clearing.

Answer

An attached office of the Department of Financial Services, Ministry of Finance, that operates India's Digital Public Infrastructure stack.

Question 6

Which one of the following entities is specifically mandated to operationalise the global deployment of UPI and RuPay, including bilateral linkages such as the India–Nepal UPI–NPI corridor?

Accepted Answer

NPCI International Payments Limited (NIPL)

Answer

Bharat Bill Payment Central Unit (BBPCU)

Answer

Indian Financial Technology and Allied Services (IFTAS)

Answer

Reserve Bank Innovation Hub (RBIH)

Question 7

With reference to India's Digital Public Infrastructure (DPI) export strategy as compared to its earlier bilateral digital cooperation, consider the following statements: 1. DigiLocker-specific MoUs have been signed with Cuba, Kenya, the UAE and Lao PDR, whereas UPI has been made operational in more than eight foreign jurisdictions. 2. The G20, during India's Presidency, endorsed voluntary and non-binding policy recommendations on DPI for advancing financial inclusion. 3. India has signed India Stack / DPI cooperation MoUs or agreements with more than fifty countries as of 2025. Which of the statements given above is/are correct?

Accepted Answer

1 and 2 only

Answer

1 only

Answer

2 and 3 only

Answer

1, 2 and 3

Question 8

The India-Nepal Inter-Governmental Committee (IGC) on Trade, Transit and Cooperation to Combat Unauthorised Trade, the apex bilateral mechanism functioning under the India-Nepal Treaty of Trade and Treaty of Transit, is headed on the Indian side by which of the following?

Accepted Answer

Commerce Secretary, Department of Commerce

Answer

Foreign Secretary, Ministry of External Affairs

Answer

Secretary, Department of Economic Affairs

Answer

Secretary, Department for Promotion of Industry and Internal Trade

Question 9

In the context of India-Nepal financial linkages, the term 'Indo-Nepal Remittance Facility (INRF) Scheme' refers to which one of the following?

Accepted Answer

A NEFT-based one-way cross-border remittance scheme launched by the RBI in 2008 for migrant Nepalese workers in India to send funds home

Answer

A bidirectional UPI–NPI peer-to-peer corridor allowing real-time remittances in either direction between India and Nepal

Answer

A swap line between the Reserve Bank of India and Nepal Rastra Bank for settlement of bilateral trade in domestic currencies

Answer

A SAARC-wide remittance corridor operated by NPCI International Payments Limited for Nepalese workers across South Asia

Question 10

With reference to cross-border remittance arrangements between India and Nepal, consider the following statements: 1. The Indo-Nepal Remittance Facility Scheme operates through the RBI's NEFT system with a ceiling on the per-transaction value, whereas the UPI–NPI linkage operationalised in 2026 enables real-time peer-to-peer transfers initiated through mobile banking apps. 2. Both the Indo-Nepal Remittance Facility Scheme and the UPI–NPI linkage are implemented by NPCI International Payments Limited (NIPL) as the nodal agency. 3. Unlike the earlier BHIM UPI QR acceptance enabled in Nepal in 2022 which was limited to merchant payments, the 2026 UPI–NPI linkage permits bidirectional person-to-person remittances. Which of the statements given above is/are correct?

Accepted Answer

1 and 3 only

Answer

1 and 2 only

Answer

2 and 3 only

Answer

1, 2 and 3

Question 11

With reference to India's Neighbourhood First policy and the international rollout of the Unified Payments Interface (UPI), consider the following countries: 1. Bhutan 2. Bangladesh 3. Sri Lanka 4. Nepal Which of the above are correctly identified as countries where UPI is currently operational for cross-border payments?

Accepted Answer

1, 3 and 4 only

Answer

1 and 3 only

Answer

2 and 4 only

Answer

1, 2, 3 and 4

Question 12

As of 2026, BHIM-UPI based cross-border payment acceptance / linkage has been operationalised with several countries. With reference to this, which of the following countries is/are NOT correctly identified as a country with an operational UPI cross-border linkage?

Accepted Answer

3 only

Answer

1 and 3

Answer

2 and 4

Answer

1, 2 and 4

UPSC Prelims Practice Questions — India and Nepal Launch Cross-Border Remittance Mechanism to Strengthen Bilateral Financial Connectivity

Q1. With reference to the UPI–NPI cross-border remittance mechanism operationalised in June 2026, which one of the following is the Indian entity that executed the technical integration with Nepal Clearing House Limited (NCHL)?

Q2. As per the Ministry of Finance announcement on the UPI–NPI cross-border remittance corridor, how many participating banks in India are live on the corridor at launch?

Q3. The Indo-Nepal Remittance Facility Scheme, conceived as India's first cross-border remittance corridor riding on the NEFT system, was launched by the Reserve Bank of India in which year?

Q4. Under the Indo-Nepal Remittance Facility Scheme, the sole designated bank in Nepal authorised to receive funds remitted from India is:

Q5. Which one of the following best describes the National Payments Corporation of India (NPCI)?

Q6. Which one of the following entities is specifically mandated to operationalise the global deployment of UPI and RuPay, including bilateral linkages such as the India–Nepal UPI–NPI corridor?

Q8. The India-Nepal Inter-Governmental Committee (IGC) on Trade, Transit and Cooperation to Combat Unauthorised Trade, the apex bilateral mechanism functioning under the India-Nepal Treaty of Trade and Treaty of Transit, is headed on the Indian side by which of the following?

Q9. In the context of India-Nepal financial linkages, the term 'Indo-Nepal Remittance Facility (INRF) Scheme' refers to which one of the following?

Q12. As of 2026, BHIM-UPI based cross-border payment acceptance / linkage has been operationalised with several countries. With reference to this, which of the following countries is/are NOT correctly identified as a country with an operational UPI cross-border linkage?