Banks laud universal bank account planBanks have welcomed the government’s announcement to bring all Nepali households into the banking channel with the help of Nepal Rastra Bank (NRB).
Banks have welcomed the government’s announcement to bring all Nepali households into the banking channel with the help of Nepal Rastra Bank (NRB).
According to the budget statement made by the finance minister to the House on Saturday, a campaign entitled Bank Account for Every Nepali will be launched. Under this scheme, everyone would have a zero-balance account, and any payment the government issues to citizens will be deposited in that account.
Around 60 percent of Nepali households have access to formal finance, according to NRB.
Delighted bankers are eagerly waiting for NRB to prepare an action plan and implement the decision as soon as possible.
“It is a welcome move by the government, and we have technology to provide this service,” said Anil Shah, vice-president of the Nepal Bankers’ Association.
“Many banks and financial institutions (BFIs) already have deposit products under which they allow customers to open an account without depositing any money, and those who do not have such plans will start offering them.” He added that the government must ensure that such accounts will not remain idle.
Meanwhile, NRB said that they would move to implement the government decision by preparing a detailed action plan.
“First of all, we must prepare an action plan in coordination with the Finance Ministry,” said a central bank official. “Many BFIs need to expand their network to rural areas. So, it might take two to three years to bring the entire population into the formal banking channel.”
NRB said banking services would be offered through branchless banking touch points (BLB) and extension counters in places where it would not be feasible for BFIs to open branches.
Although, the new budget has not announced any other specific plan for the financial sector, bankers have praised the government’s annual financial plan for its emphasis on infrastructural development.
“It has rightly put emphasis on infrastructure and agriculture; and overall, it is a good budget,” said Shah. “If the government is able to carry out the capital expenditure as planned, the formal financial sector will benefit automatically.”
However, Shah expressed doubts about the implementation of the budget considering the government’s track record of low capital expenditure.