The Nepal Stock Exchange (Nepse) has made digital transactions of shares mandatory for commercial banks from Monday in a move towards full computerization of the secondary market. There are 31 commercial banks in Nepal. 

According to CDS and Clearing Limited (CDSCL), a subsidiary of Nepse, paperless transactions will be implemented for other listed companies soon. 

“We have made digitalized share transactions mandatory for commercial and development banks from Monday,” said Sabina Pujari, spokesperson at 

CDSCL. She said that they had initiated electronic share transactions for all the listed companies as part of their plan to go for complete online trading.

Nine commercial banks have already been doing paperless transactions 

of their shares. According to Pujari, 22 commercial banks and nine development banks and micro finance companies started paperless transactions on Monday. 

Agricultural Development Bank, Bank of Kathmandu, Century Bank, Citizens International, Civil Bank, Everest Bank, Himalayan Bank, Kumari Bank, Laxmi Bank, Lumbini Bank, Machhapuchchhre Bank, Mega Bank, Nepal Bangladesh Bank, Nepal Bank and NCC Bank shifted to demat transactions on Monday, according to CDSCL. 

Similarly, Nepal SBI Bank, NIC Asia, NMB Bank, Prabhu Bank, Sanima Bank, Grand Bank and Siddhartha Bank have started paperless transactions.

Likewise, Business Universal Development Bank, Kailash Bikas Bank, Summit Development Bank, City Development Bank, Deprox Development Bank, Shine Resunga Development Bank and Excel Development Bank have started digital transactions. Rural Micro-finance too has gone for complete demat transactions.

Of the total 237 companies listed on the Nepse, 106 have registered with CDSCL for demat transactions. “Among them, 65 companies including commercial banks, insurance companies, hydropower companies and development banks have gone completely into demat transactions,” said Pujari, adding another 32 companies were planning to convert shares into demat form.

According to CDSCL, investors can carry out share transactions with their Beneficiary Owned Identification Number provided by the Depository Participants, the institutions through which shares are converted into electronic format. The implementation of paperless transactions aims to end various problems related with stock trading including possible loss and damage of paper certificates. In addition, electronic documentation will allow transactions to be conducted in less time than would take with physical shares.

Pujari said investors could now complete their ownership transfer within four days of the transaction. Earlier with physical transactions, it used to take up to two to three months to complete the transaction including the ownership transfer.

According to her, CDSCL will be implementing demat transactions for another 41 companies on August 24.

Nepse jumps 45.55 points

Nepal Stock Exchange (Nepse) on Monday jumped 45.55 points to close at 1,157.6 points. The rise was led by the commercial banks’ group that posted a healthy 64.67-point growth. The exchange made demat transactions of bank shares mandatory from Monday. “Investors are now converting their physical share certificates into the digital format,” said Narendra Raj Sijapati, president of Nepal Stockbrokers’ Association. He said this affected supply, sending the prices soaring. on Monday, almost all the trading groups, except for trading, posted gains. The market witnessed a turnover of Rs825.56 million, while the market capitalisation reached 1,192.46 billion. (PR)