Nepal’s Department of Tourism has issued a directive, completely banning online gambling in the country. All forms of iGaming activity are prohibited due to the risk of money laundering and the inability to control cross-border payments.
The government of Nepal has issued a sweeping set of regulatory changes aimed at reshaping its gambling sector — including a complete prohibition on online and internet-based casino gaming. The move is part of a 12-point directive issued by the Department of Tourism under the Ministry of Culture, Tourism and Civil Aviation, designed to strengthen compliance with anti-money-laundering (AML) and counter-terrorist financing (CFT) laws.
With gambling increasingly conducted via the internet, regulators state the new rules aim to plug loopholes and bolster integrity in the market.
While the online ban garners much of the attention, the directive also imposes several strict requirements on land-based casinos. Operators must now fully align with the country’s casino regulation framework — notably the Casino Regulations, 2082 — and adhere to tough surveillance, KYC (Know Your Customer) and biometric identification standards.
This includes mandating continuous CCTV monitoring across gaming floors, with recorded footage stored for a minimum of six months for inspection and audit purposes. Casinos aren’t allowed to operate via third-party contracts or in venues outside those authorized in their licences, closing a previously exploited regulatory gap.
Another major change concerns financial flows. The directive forbids casinos from handling foreign-currency transactions unless explicitly permitted by the Nepal Rastra Bank (NRB). This is intended to curb unregulated cross-border transactions and reduce the risk of money-laundering within the gaming sector.
Additionally, before paying out winnings, operators must now withhold and issue a tax deduction certificate reporting both to the Inland Revenue Office and the Department of Tourism—a step geared at improving transparency of gaming earnings.
Perhaps the most striking measure is the outright ban on any form of online casino gaming—branding such activity as “unregulated”, subject to high risk of illicit financial flows, and incompatible with Nepal’s AML/CFT goals.
This clamp-down comes as Nepal efforts to exit the Financial Action Task Force (FATF) Grey List intensify. Regulators say that expanding oversight into non-financial sectors (including casinos, real estate and precious-metals) is part of the next wave of reform.
Given the surge in internet-based gambling, the online ban is seen as a strategic move to reinforce regulatory control and minimise reputational and financial-integrity risks.
For casino operators the new regime raises significant compliance requirements and potential costs: biometric KYC systems, site-wide CCTV, six-month video retention, foreign-currency restrictions and new taxation reporting all add to operational burdens. For online operators targeting Nepal, the ban effectively shuts access to one jurisdiction, forcing a strategic rethink about how to manage growth in South Asia.
For customers, the crackdown may reduce the availability of online casino options but could also lead to a safer land-based environment—assuming enforcement is consistent.
Analysts believe the move signals Nepal’s commitment to building a more transparent financial-gaming ecosystem, improving its standing in global AML/CFT assessments and protecting its market from illicit flows.
The success of these regulatory changes will depend heavily on enforcement, cooperation between financial authorities and tourism regulators, and the ability to effectively monitor compliance in the field. If successful, Nepal may become a regional leader for gaming compliance.
However, weak implementation may undermine the reform’s impact and leave the sector susceptible to the same risks it aims to remedy.
