When Juna Bastola paid Rs350 for a month of Netflix and Rs300 for three months of Amazon Prime Video via a digital service platform (premiumsewa), she knew she was not buying from the official platforms. But it was cheap, quick, and required no dollar card, and that was enough.

“Buying directly would require a dollar card and a subscription at a high price, so I chose the cheaper option,” Juna said. “I was paying around a quarter of the original price.”

This choice reflects a much larger phenomenon: a rapidly expanding digital market in Nepal, a legal framework struggling to keep up, and a grey zone where consumers, resellers, and regulators collide.

Across Nepal, thousands of users are making similar calculations. Resellers advertise ‘premium’ subscriptions on Facebook and Instagram at heavily discounted rates, often sharing accounts among multiple users. For many, it is a practical workaround to high costs and foreign currency restrictions. It is also a growing grey market that exposes gaps in Nepal’s e-commerce laws, tax collection, and consumer protection mechanisms.

According to Nepal Telecommunication Authority (NTA), the regulatory body, internet penetration in the country stands at around 104 percent of the population. Similarly, the Economic Survey of 2025, an annual government report on the country’s economic performance, cites broadband user density at 144.23 percent, based on Nepal’s total population of approximately 29.6 million. This figure counts SIM cards, not unique users, meaning many users hold multiple connections.

With connectivity now exceeding population levels on paper, the potential market for streaming services has expanded rapidly. The over-the-top (OTT) streaming usage is growing alongside internet access. Telecom data now accounts for 52 percent of operator revenue, as traditional voice services continue to decline. This shift reflects growing demand for online content, and analysts project that by 2030, nearly one million Nepalis may subscribe to international OTT services.

Digital payments have surged in parallel. Digital wallet transactions grew from Rs114 billion in fiscal year (FY) 2020-21 to Rs506 billion in FY 2024-25, as part of a broader electronic payment ecosystem now tripling to roughly Rs98 trillion. This scale presents both opportunities and challenges, involving millions of users, billions of rupees, and a largely digital economy that regulators are still learning to track.

Resellers operate a simple but profitable model. Rajesh BK (name changed on request), a former Netflix reseller, said: ‘‘Sellers buy Netflix or premium subscriptions from countries like Pakistan, India, Brazil or Colombia where prices are cheaper and share them with multiple customers.’’ Payments are made in rupees; the reseller handles foreign exchange logistics.

Himal Thapa, who runs an online service called cheapmandu, said his business has been operating for about three years. “We use dollar cards to pay for the subscriptions and then distribute the accounts among customers,” he said. “Customers don’t need to use dollar cards themselves. We take care of the foreign payment.” He added that his accounts have never been terminated due to policy violations.

For users like Anuj, the service is convenient. It bypasses the need for dollar cards and avoids exchange limitations imposed by the Nepal Rastra Bank, the central bank.

Yet the risk exists. BK added that Netflix recently removed the password-sharing feature, leading to account suspensions and angry customers. ‘‘IP tracking sometimes caused bans,’’ he said. ‘‘Even if a local reseller is registered, sharing accounts violates platform terms.’’

Users on Reddit, an online discussion forum, report similar frustrations. One wrote, ‘‘He paid, and the account never worked properly. I tried contacting the seller, but got no response.’’ Another noted, ‘‘My father’s subscription was blocked, and the seller disappeared after getting the money.’’

Not everyone in the ecosystem has had smooth experiences.

From a legal perspective, Department of Commerce, Supplies and Consumer Protection Director Taranath Luitel said, ‘‘Any business offering digital services must be registered and enlisted under Nepal’s E-commerce Act, 2025 framework. Only then are they legally eligible to deliver the services.’’

He said, ‘‘This applies to goods or services sold via online platforms, whether through social media marketplaces or their own websites. Otherwise, it is a violation.’’

The law requires firms to display registration certificates, PAN numbers, a representative contact, and safeguard user data. Legal analysts, including Arjan KC of Gurkha Technology, say the Act applies extraterritorially— foreign platforms selling to Nepali users also fall under its scope.

Yet compliance is uneven. According to Luitel, ‘‘Only around 300 firms have been enlisted, with nearly 900 to 1,000 applications under review.’’ The department has taken action and issued fines to some resellers, but is currently emphasising registration and consumer awareness over penalties.

‘‘Consumers often look only for the cheapest service without checking if the firm is eligible or if there is a risk of fraud,’’ he said. ‘‘They should check for the registration number and certificates.’’

According to Luitel, OTT platforms serving Nepali users must also comply with broadcasting regulations overseen by the Ministry of Communication and Information Technology.

“To provide services in Nepal, OTT platforms must obtain approval from the ministry,’’ Luitel said. ‘‘As far as our understanding goes, Netflix is not registered with the ministry.’’

Amendments to Nepal’s National Broadcasting Regulations require OTT platforms to obtain prior approval, maintain content records, and, in some cases, establish local cache servers if they serve Nepali users. Platforms such as TikTok and Viber are registered, but Netflix is not.

This regulatory gap means that a platform may be accessible to Nepali users and even pay taxes locally, yet remain outside formal broadcasting approval, exposing it to potential restrictions or notices from the ministry.

On the tax framework, the Inland Revenue Department spokesperson said that, ‘‘Nepal has introduced a 2 percent Digital Service Tax (DST) in 2022 for multinational digital platforms such as Google, Amazon and Netflix.’’ DST targets companies generating income from Nepali users without a permanent office in the country.

It also addresses a practical challenge: regulators cannot track cross-border digital transactions. Payments, viewership metrics, and ad revenue often flow through servers in other countries. Companies self-declare income and remit tax via local representatives.

‘‘Collections are growing,’’ the official said. DST revenue was Rs16 million in FY 2022-23 and Rs58 million in FY 2023-24. VAT from digital services amounted to Rs358 million in FY 2023-24.

When asked about domestic resellers, the official said, ‘‘There is no explicit requirement for individuals or micro-resellers to pay DST, and the monitoring authority is limited. DST applies to multinational, cross-border transactions, not local resales.

Nepal’s digital regulation is divided across four segments: Commerce registration, broadcasting approval, cross-border taxation and foreign currency transactions. Each operates independently, creating a fragmented system with limited coordination.

For users like Anuj, legality is secondary to affordability. Many overlook registration or dispute mechanisms. Reddit accounts show blocked subscriptions, vanished sellers and lost payments.

Luitel urges consumers to check registration and enlistment certificates before paying for any service. Analysts note that without systemic oversight, millions of users navigate a market where risk is normalised.

Nepal’s digital economy is expanding faster than regulators can track. Platforms may be tax-compliant but broadcasting-unlicensed. Resellers may be business-registered but may be operating in a jurisdiction where subscription negotiation is illegal.

Until that gap is closed, the grey market for Netflix and other digital services will continue to thrive in the shadows of legal uncertainty, experts say.