Nepal Rastra Bank Directs Appointment of Focal Persons to Combat Cyber Fraud During Festivals: How Effective Could This Be?
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Nepal Rastra Bank has issued directives to appoint ‘focal persons’ (designated individuals) during festivals to promptly address incidents of cyber fraud and online scams.
The central bank and the Financial Institution Regulation Department have instructed all banks and financial institutions in categories A, B, and C to implement these measures to mitigate cyber security risks.
Following this directive, banks have started appointing focal persons, and the Nepal Bankers’ Association has stated that this will aid in controlling fraud incidents.
Online transactions have surged in recent years, accompanied by a rise in cyber fraud and scams, especially during festival periods.
Banks and financial institutions are required to provide the name, position, mobile number of the focal person, and a duty email address monitored 24/7 throughout the week to the Nepal Police Headquarters at cbpillar@nepalpolice.gov.np, as mandated by the Nepal Rastra Bank.
What Additional Measures Does Nepal Rastra Bank’s Directive Include?
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The Nepal Rastra Bank has instructed banks and financial institutions to take immediate action to recover funds once a cyber fraud or online scam complaint is received.
“Banks and financial institutions are directed to promptly provide transaction details related to electronic fraud during festivals, quickly identify and freeze suspicious accounts and transactions, and facilitate overall investigation processes by appointing responsible individuals,” the bank’s statement reads.
“Since digital transactions increase during festivals, this step aims to strengthen coordination with security agencies to address criminal activities and mitigate risks of online scams,” it added.
Bank spokesperson Guruprasad Paudel explained that because of the increased risk of digital scams during festivals and extended holidays, banks and financial institutions often cannot respond effectively without such guidelines.
“Considering current practices and upon the request of Nepal Police Cyber Bureau as well as the initiative of Nepal Rastra Bank, this directive ensures responsiveness even during long holidays by designating a single focal person to utilize the ‘golden hour’ after an incident,” he stated.
“As people celebrate festivals, some attempt fraudulent activities. This arrangement ensures the focal person pays special attention to prevent such incidents,” he added.
What Actions Are Banks Taking Following the Directive?
Santosh Koirala, president of Nepal Bankers’ Association, stated that although necessary systems were in place before, banks have now started appointing dedicated focal persons for the festival period.
“We are creating a mechanism within banks to take immediate action upon receiving complaints and send reports to cyber units,” he said.
“Hackers tend to be most active during festivals. To counter this, Nepal Rastra Bank issued this circular. We had considered this measure earlier as well. While complete control isn’t guaranteed, it certainly helps,” he added.
He mentioned banks have records of hackers transferring funds from three banks within one minute.
“In such cases, there is an opportunity to immediately freeze the transferred amount or notify the receiving bank to prevent further transactions, thus safeguarding the funds,” Koirala explained.
“There are numerous instances in the past where money was frozen immediately after receiving transfer notifications.”
Customers are encouraged to report suspected fraud instantly to the designated numbers to enable prompt resolution.
“If a customer reports ‘my money is missing’ or ‘my account has been hacked,’ we immediately inform all banks to place a hold on the transaction and notify the cyber department,” Koirala said.
“If the money hasn’t been transferred yet, we can arrange to hold the account, but if the transfer is complete, filing a complaint with the cyber police is the only remaining option.”
Hackers commonly attempt to lure customers into updating their KYC, sharing OTPs, or screen sharing to divert funds.
Koirala advised reporting suspicious activity immediately to the contact numbers provided by banks or financial institutions.
What Is the Current Status of Digital Payments in Nepal?
According to the latest data compiled by Nepal Rastra Bank, digital payment adoption is rapidly expanding throughout Nepal.
There are now over 30 million mobile banking users, approximately 28 million wallet accounts, and around 14 million issued debit cards, the central bank reports.
Monthly mobile banking transactions reach approximately 80 million, involving over 60 billion Nepalese rupees in volume.
“Mobile banking has evolved from a service to check balances or transfer funds to a primary channel for everyday financial transactions,” said the central bank spokesperson Paudel.
He also highlighted the growing significance of QR payments, which have become an important component of retail transactions.
“In a month, roughly 75 million QR transactions amounting to about 16 billion rupees take place, demonstrating the widespread adoption of digital payments among merchants, service providers, and consumers.”
