Banking in Nepal

Banking in Nepal began with the establishment of Nepal Bank Limited in 1937, marking the country's first formal financial institution. The sector gained momentum with the founding of the Nepal Rastra Bank (NRB) in 1956, which became the central regulatory authority. Over the decades, Nepal transitioned from a state-dominated banking model to a liberalized, competitive financial ecosystem.

Regulatory Framework The banking system is governed by the Nepal Rastra Bank Act, Bank and Financial Institutions Act (BAFIA), and various NRB directives. NRB classifies financial institutions into four categories: ClassTypeDescriptionA Commercial Banks Full-service banks with national reachB Development Banks Focused on regional development financinC Finance Companies Provide hire purchase, leasing, etc.D Microfinance Institution Target low-income and rural populations

Current Status

According to NRB reports: Banks/BFIs ClassNo. of BFIs No. of BranchesCommercial Banks (A) 20 5,099Development Banks (B) 171,132Finance (C) 17 291Microfinance (D) 54 6,522Infrastructure Development Bank 1 -Total 109 13,044 Deposit Accounts: 5.91 crore (exceeding Nepal's population of ~3 crore)

See also

History of banking Nepal Rastra Bank Nepalese Rupee List of banks in Nepal Commercial banks of Nepal

References