Nepal Rastra Bank Governor Chiranjibi Nepal has called on banks and financial institutions to raise their investment in staff training, stating theoretical knowledge provided by universities may not be sufficient for fresh graduates to deal with growing number of cases related to financial crime.

“The demand for highly-skilled human resources is growing every day in the financial sector because of threats posed cyber criminals, and those engaged in financial crime, such as money laundering and terror financing,” the governor told the international conference organised jointly by the Asian Pacific Association of Banking Institutes, National Banking Institute (NBI) and Nepal Bankers’ Association in Kathmandu on Friday.

“So banks and financial institutions must invest in creating human capital.... as skilled employees are lifeblood for any organisation.”

Nepal’s banking sector has grown by leaps and bounds since the mid-1980s, when Nepal first took initiative to liberalise the sector. But even till date most of the banks invest less than one percent of total employee cost in staff training, as against international norms of five percent to seven percent.

“As a result, many institutions now face shortage of skilled human resources in senior posts,” Nepal said. Acknowledging this problem, the central bank has recently made it mandatory for banks and financial institutions to set aside at least three percent of total employee cost for staff training. NBI CEO Sanjib Subba said the risk is inherent in the banking system and it cannot be eradicated.

“But with the deployment of skilled human resources this risk can be minimised,” he said.