Digital Finance System in Nepal

Promotion of Digital Finance in Nepal need of the hour

Stakeholders have stressed on the need to promote Digital Finance in Nepal to bring in the unbanked population of the nation into the formal financial/banking system.

Speaking at an interaction programme on ‘Digital Finance in Nepal’, which was jointly organised by the Society of Economic Journalists — Nepal (SEJON), United Nations Capital Development Fund (UNCDF) and Nepal Rastra Bank (NRB), the stakeholders said that enhanced digital financial system will enable the unbanked population of the country to have access to financial services including savings accounts, credit and insurance.

“All of us in the financial ecosystem here in Nepal have a role to play in making the digital financial system work effectively. The development of efficient electronic payment system can act as a catalyst to build such digital financial system,” said Ahmed Dermish, digital financial ecosystem specialist at UNCDF’s MM4P Programme.

In a bid to bring people into the financial system, banks and financial products should be simple, convincing and flexible, according to Dermish.

On the occasion, Padam Raj Regmi, assistant director of NRB, said the central bank has already established a separate payment settlement department and introduced policies like payment system development strategy and licensing policy targeting payment institution in order to regulate and facilitate digital financial system in the country.

Meanwhile, industry insiders said the low banking penetration and advancement in telecommunication technology have set the stage for the digital financial system to thrive.

“The banking penetration is only 60 percent, while 135 percent of the population has access to mobile phones,” said Daniel D Shrestha, chief operating officer of IME Digital, adding that with the central bank introducing the favorable policy, this is an ideal environment for the alternative digital finance in Nepal to grow.

Cover Photograph: UNCDF Nepal

This article was originally published at The Himalayan Times on 10 March 2018. It has been republished here for reference purpose only.

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Promotion of Digital Finance in Nepal need of the hour

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