News Summary
- According to Nepal Rastra Bank’s study, financial access has reached 67.3% of the population nationwide, with the number of deposit accounts nearly double the population.
- By mid-February of the current fiscal year, the number of bank and financial institution branches reached 11,490, with population per branch decreasing to 2,538.
- Digital transactions have reduced the work of bank branches, with customers primarily visiting branches for loans only.
March 24, Kathmandu – With increased use of digital technology in the banking sector, customers now primarily visit bank and financial institution branches only to apply for loans.
While branches still handle cheque and cash transactions, advancements in technology have widely reduced the need for branch visits for most banking operations.
When examining financial access from the branch perspective, every one of the country’s 753 local units has commercial bank branches available.
Nepal Rastra Bank conducted a study on financial access in 2019 (2076 BS), revealing that 67.3% of the country’s population had access to financial services.
Since then, technological advancements have brought banking services to every individual’s mobile device, with the number of deposit accounts now almost double the total population, according to the central bank.
Due to the extensive use of technology, the workload at bank branches has declined. Nepal Rastra Bank Governor Professor Dr. Bishwonath Paudel explains that daily average customers visiting financial institutions for services used to be around 150 per branch but have now decreased to between 20 and 30.
“Expanding branches alone will not suffice,” Paudel said. “Reducing the number of branches to cut costs will help lower the cost of funds and interest rates.”
Consequently, both banks and Nepal Rastra Bank are working in alignment with digitization plans. Efforts are underway to ensure people do not need to physically visit banks or the central bank, he added.
The 2019 study showed that Nepal’s banks and financial institutions had approximately 3,300 people per branch. At that time, the total number of deposit accounts was 27.8 million and loan accounts reached 1.44 million.
Similarly, mobile banking users numbered approximately 8.35 million, and there were about 6.79 million debit cards in circulation.
By mid-February 2026 (2082 BS), the central bank reported significant improvements. Deposit accounts at Class A, B, and C banks and financial institutions rose to 61.85 million, and loan accounts increased to 2.03 million.
By that time, the total number of bank and financial institution branches reached 11,490, while the population per branch dropped to 2,538.
Nepal Rastra Bank spokesperson Gurupasad Paudel confirmed the considerable achievements in digital transactions. He stated, “With at least one bank branch every 10 kilometers, digital transactions are expected to increase further.”
He added that branch closures are appropriate if multiple branches exist in the same location, yet branches remain necessary to maintain financial access and awareness.
The central bank noted that QR payment transactions increased from 855,000 in July 2020 (Ashad 2077) to 46.2 million by mid-February of the current fiscal year.
Mobile banking transactions also rose from 13.7 million five years ago to 67.3 million by mid-February of this fiscal year.
By mid-February, decisive payments via QR amounted to NPR 125 billion, while mobile banking payments totaled NPR 558 billion.
Despite recent central bank policies and growth in digital transactions, the number of branches has decreased. Branch numbers fell starting 2022/23 (2079/80 BS), partly due to mergers and acquisitions.
Three years prior, there were 11,580 branches; currently, they are limited to 11,490.
Financial access will now be reviewed based on payments, service centers, and savings and loan accounts. According to central bank director Sushil Paudel, access can be assessed through payments, savings, credit, and insurance coverage.
While financial access has expanded, quality remains a concern. Paudel stated, “Nearly 90% financial access is reflected by savings accounts, branches, and payment transactions, but borrowing activity is low. There is reluctance to take loans, and improvements in financial resource deployment are limited.”
Financial literacy levels are weak, and consumer protection standards remain inadequate. Since 2019, no comprehensive financial access survey has been conducted.
They have also noted an increase in fraud cases and the need to improve financial awareness. While financial transactions occur normally, easy access to credit is critical, with collateral and loan repayment methods playing major roles.
The QR system has successfully expanded the number of service centers without limitations. In the digital era, this access is not confined to specific locations. Payments can be conveniently made via mobile at shops, effectively turning each store into a financial service center.
“For loans, branch visits are still necessary, but in the future, digital delivery methods will make this possible,” he said. “The central bank is preparing the required policy framework for this.”
