NRB to conduct rural credit survey

KATHMANDU:

The central bank will conduct the ‘Fourth Rural Credit Survey’ — a comprehensive survey on the reach of credit to the rural populace — after a gap of more than two decades.

Nepal Rastra Bank (NRB) had undertaken a similar survey back in fiscal year 1991-92. The survey will study in detail the presence and penetration of financial institutions and other types of financial intermediaries in the rural areas of the country. The study will also look into the existence of informal lenders and their transactions, along with the presence of lending institutions in those areas.

NRB has asked for expression of interest from research institutions to undertake a field survey in the 15 selected districts — Dolakha, Jumla, Bajura, Dhankuta, Tehrathum, Kavrepalanchowk, Gorkha, Gulmi, Jajarkot, Dadeldhura, Jhapa, Mahottari, Rupandehi, Dang and Kanchanpur. Samples will be taken from 5,400 households and 952 institutions, including banks, financial institutions and savings and credit cooperatives.

“The survey’s result will be helpful for policymakers to implement suitable policies regarding financial transactions, state of formal lending and interest, along with the prevalence of informal lending, among others,” informed NRB spokesperson Bhaskar Mani Gnawali.

“Nepali financial intermediaries and the financial system have undergone significant changes in the last two decades, so this survey will help the authorities to design future monetary, fiscal and banking policies based on contemporary rural banking scenario,” he added.

Most importantly, the study — which was first undertaken in 1969-70 — is aimed at providing an insight into the country’s financial access in rural areas.

NRB had been trying to get the survey conducted since 2010 and had also announced the plan for it in its monetary policy for 2010-11. The subsequent monetary policies also reiterated the plan, however, nothing concrete had taken shape. Moreover, NRB’s Strategic Plan 2012-16 also mentioned that the survey will conclude within 2014.

In Nepal, financial services are limited, with less than one-fifth of the population having an bank account.

According to World Bank’s Global Findex Database, which studies the state of financial inclusion among 148 countries, only 25.3 per cent of adults in Nepal have savings at a formal financial service provider, including banks, microfinance institutions or cooperatives. The study found that one-half of the world’s population does not have formal bank accounts.

Source: THT