Nepal Overhauls Casino Laws with Strict AML and Capital Requirements

• Nepal’s gambling market is projected to grow at a 10.7% CAGR through to 2026, driven by its strategic location and rising digital penetration.
• The government has introduced a major regulatory overhaul for its land-based casino sector, including the Casino Regulation 2080 BS and a new 2025 AML Directive.
• The new rules impose high minimum capital requirements ( up to NPR 300m), strict compliance measures, and a requirement for casinos to report any customer spending over NPR 1 million (approx. $7,265) in a single day.
• These reforms are aimed at increasing transparency and bringing Nepal’s tourist-focused casino industry in line with international standards.
• In stark contrast, the online gambling sector, which is popular with locals, remains completely unregulated, creating a significant black market.

Nepal is rapidly emerging as a key gaming destination in South Asia, with market analysts projecting a compound annual growth rate ( CAGR) of 10.7% between 2020 and 2026. This growth is occurring amidst a major government effort to formalise its land-based casino sector, even as the popular online market remains an unregulated grey area.

Strategically located between India and China, the country is leveraging its strong tourism industry to build a credible, land-based casino hub. However, the government is now introducing a raft of new, stricter regulations designed to enhance transparency and align the sector with international standards.

New Regulations Target Land-Based Transparency

The cornerstone of the regulatory overhaul is the new Casino Regulation 2080 BS, which replaces a framework from 2013. This is coupled with a new Anti-Money Laundering (AML) Directive introduced this year. Together, they create a much higher barrier to entry and a stricter compliance environment. Key new requirements include:

• Increased Capital Requirements: Operators must now have a minimum paid-up capital of NPR 300 million (approx. $2.18m) for large casinos and NPR 200 million (approx. $1.45m) for smaller ones. Local experts believe this will likely lead to market consolidation, favouring larger, more financially stable companies.
• Strict AML Reporting: The 2025 AML Directive, issued by the Department of Tourism, mandates that casinos must report any individual customer who spends NPR 1 million (approx. $7,265) or more in a single day.
• Operational Integrity: The new rules also enforce a “one licence per company, per hotel” policy, require 24/7 CCTV surveillance, and mandate a 2% levy on net profits to be allocated to corporate social responsibility (CSR) projects.

The Unregulated Online Paradox

This robust push for regulation stands in stark contrast to the situation in the online sector. While the licensed land-based casinos are legally restricted to serving only foreign tourists, online gambling has become immensely popular with local Nepali users, particularly those under 35.

This entire online ecosystem operates in a legal grey area, with thousands of Nepalis accessing offshore gambling websites. Because it’s completely unregulated, there is no official data on its market value, no player protections are in place, and the state collects no tax revenue from it.

Implications for the Industry

For the land-based sector, the new regulations represent a significant step towards maturity. While the increased capital and compliance costs will be challenging for smaller operators, they are a clear signal that Nepal is serious about building a transparent and internationally credible casino industry.

As local advocate Ramesh Ghimire noted, the reforms “will likely improve the long-term credibility, investment potential, and integrity of Nepal’s casino industry.” However, the government’s current blind spot on the burgeoning online market remains a major unresolved issue, creating a tale of two very different gambling sectors within the same country.