This is all legal. This system was introduced for NRN working abroad.  . You show your legal source of income, open an accunt in nepali bank and transfer dollar from your work/business abroad to Nepal. You get 2% interest on your dollar account.
This is one way flow. No one is stopping the flow of money two way. If it was illigal they should have never issued you a debit Visa card.

The tricky part is you have to deposit either dollar or transfer dollar from your forign bank to Nepali bank in Nepal to withdraw dollar abroad. you will be abel to withdraw money in local currency. That means if you have a dollar account in Nepal you will be able to withdraw japanese yen in Japan using your debit visa card. How you get dollar in Nepal ?

Positive side of this system is,  people are taking dollar out of nepal anyway, through illigal means. When you do through banking system
1. money enetrs into banking system which is legal.
2. banks make some money instead of some illigal operator

Yes once the money enetrs into banking system it can be easily tracked. But if your income is Legal you dont have to worry.
Yes offcourse if your money is illigal income then it is illigal everywhere by whatever means you bring them.
Important thing to remeber is this is not for business purpose. This is for personal use only

Here , I am making you guys aware of the services provided by Nepali banks nothing else.