- Manil Maharjan
With the first-ever federal elections giving rise to new federal units in the country, the issue of financial federalism and access is expected to gain rapid momentum. The administrative division of the nation alone cannot justify the whole rational behind federalism unless the issue of decentralizing the city-centered financial services to inaccessible villages are dealt with priority. Nepal Rastra Bank, the banking regulator, seems to have taken a serious note about this issue and has therefore been urging Banks and Financial Institutions (BFIs) to take their services to all 753 local units of the country. Many BFIs have responded the call from NRB with unprecedented enthusiasm and active approval with several banks having already opened numerous branches in the first 5 months of the fiscal year 2074/75.
A landmark stride towards the financial federalism of Nepal is being taken by NIC Asia Bank (NICA) which has successfully brought into operation several of its new branches in the review period. In a span of some 5 months, 14 new branches have started serving the rural folks. The bank has its branch offices at Martadi in Bajura district, Chandananath Ward No. 05 of Jumla, Bardibas Municipality Ward No. 01 of Mahottari, Mahakali Municipality Ward No. 04 of Darchula district, Sidhhicharan Municipality Ward No. 12 of Okhaldhunga district, Musikot Municipality Ward 05, Bagbazar of Rukum, Bhimeshwor Municipality Ward No. 03 of Charikot, Ghodaghodi Municipality Ward No. 10, Pahalmanpur, Kerabari Rural Municipality Ward No. 8, Kerabari, Bhagwanpur Rural Municipality ward No. 04, Bhagwanpur, Naraha Rural Municipality Ward No. 06, Naraha, Joshipur Rural Municipality Ward No. 2, Kailali, Bheri Municipality Ward No. 4, Jajarkot And Pathari/Sanishare Municipality – 1, Janaandolan Chowk of Morang.
A recent case in point is that of Citizen Bank International (CZBIL) that recently opened its 67th branch at Banglachuli of Dang District. This was the 7th branch office that the bank had managed to open in this fiscal year followed by 6 other branches at Chahara of Palpa, Bhumahi of Nawalparasi, Manahari of Makwanpur, Badhaiya Tal of Bardiya, Haldibari of Jhapa and aurahi of Mahotari.
Next, it’s the case of Siddhartha Bank which has already inaugurated 3 branch offices at 3 rural and semi-urban locations of Nepal. The local folks in Battar of Nuwakot, Charikot of Dolakha and Baglung Bazar of Baglung are expected to be connected to the national banking track with opening of these three branch offices. With this latest expansion effort, the bank has reported to have extended its services with 80 branch offices, three extension counters, 103 ATM outlets, 99 branchless banking locations and more than 600 POS machines.
Another institution which gained the limelight of national media during the review period is the Nabil Bank. The bank grabbed much attention on Dec 5th when it inaugurated 10 branch offices at different locations of the country. Birendranagar of Surkhet, Tikapur of Kailali, Taal Chowk, Bagar and Amarsingh Chowk of Kaski, Lamahi of Dang, Bardibas of Mahottari, Taandi of Chitwan, Lahan of Siraha, and Hariwan of Sarlahi saw the expansion of the branch offices of Nabil Bank. A press statement issued by the bank read, "The bank will now be providing banking services via 62 branches, including the 10 new branches, 100 ATMs and more than 1,500 Nabil Remit agents across the nation."
| Name of the class A Banks |
Number of Branches by first 5 months of the fiscal |
Location of the Branch Offices |
| NIC Asia Bank Limited |
14 |
Martadi- Bajura, Chandananath Municipality ward No. 05- Jumla, Bardibas Municipality Ward No. 01- Mahottari, Mahaakali Municipality ward No. 04- Darchula, Sidhhicharan Municipality Ward No. 12- Okhaldhunga, Musikot Municipality Ward 05, Bagbazar- Rukum, Bhimeshwor Municipality Ward No. 03- Charikot, Ghodaghodi Municipality Ward No. 10- Pahalmanpur, Kerabari Rural Municipality Ward No. 8- Kerabari, Bhagwanpur Rural Municipality ward No. 04- Bhagwanpur, Naraha Rural Municipality Ward No. 06- Naraha, Joshipur Rural Municipality Ward No. 2- Kailali, Bheri Municipality Ward No. 4- Jajarkot, Pathari/Sanishare Municipality – 1, Janaandolan Chowk- Morang |
| Citizens Bank International Limited |
7 |
Banglachuli- Dang
Chahara- Palpa
Bhumahi- Nawalparasi
Manahari- Makwanpur
Badhaiya Tal- Bardiya
Haldibari- Jhapa
Aurahi- Mahotari |
| Siddhartha Bank Limited |
4 |
Battar- Nuwakot
Charikot- Dolakha
Baglung Bazar- Baglung
Banepa- Kavre |
| Nabil Bank Limited |
10 |
Birendranagar- Surkhet
Tikapur- Kailali
Taal Chowk, Bagar and Amarsingh Chowk of Kaski
Lamahi- Dang
Bardibas- Mahottari
Taandi- Chitwan
Lahan- Siraha
Hariwan- Sarlahi |
| NMB Bank Limited |
2 |
Bateswor- Dhanusha
Chulachuli- Ilam |
The latest breakthroughs have arrived amidst the claim from the central bank that 120 local units in the country are still out of the banks’ reach. This statement from the Governor of NRB Chiranjibi Nepal came as a reminder to the BFIs when he was addressing the 20th Annual Day of Society of Economic Journalists-Nepal (SEJON) on Dec 1. The commercial banks therefore need to venture out more aggressively in the rural parts in line with the government’s new policy to have at least one bank branch in each of the local units delineated under the new federal set up.
The current expansion bids of commercial banks is ultimately expected to ease the financial discrepancy between urban and rural areas of Nepal. According to Economic Activities Study Report of Nepal Rastra Bank (NRB) of Fiscal Year 2016/17, the share of deposit mobilization and credit disbursement of BFIs in Kathmandu region stood at 68.3% and 51.7% respectively. This is a bleak picture of what our economy looks like and the latest endeavors from the commercial banks and their regulator is expected to make further impetus to our young federalism.
Disclaimer: The list of commercial banks with newly opened branch offices are still growing manifold. Therefore, any new information will be duly updated. Meanwhile, several others could have been omitted in the list and will be updated as we gather latest data.
