Nepal’s ambitious push to build a paperless, digitally empowered state is running into a basic problem: the systems meant to deliver public services are increasingly unable to keep up with demand.

From government offices inside Singha Durbar to ward offices in the high mountains, digital platforms are being hit by server crashes, operational bottlenecks and prolonged service outages. What were intended to make public services faster and more accessible have, in many cases, become new points of delay and disruption.

The failures are no longer isolated incidents. They have become a recurring feature of public administration.

Critical systems, including the central National Identity Card (NID) verification network, land revenue and property registration databases, transport management portals, immigration systems at international gateways and national tax platforms, have all experienced serious disruptions.

Officials and technology experts point to a combination of obsolete hardware, shortsighted technological planning, flawed public procurement, heavy dependence on foreign vendors and a shortage of specialised technical personnel in the civil service.

Over the past decade, government agencies have digitised large parts of their operations, introducing dozens of software applications and online portals. These include the Line Ministry Budget Information System (LMBIS), managed by the Ministry of Finance; the Subnational Treasury Regulatory Application (Sutra), used by local governments for budget planning and financial reporting; the Integrated Tax Management System (ITMS), deployed across the Inland Revenue Department and regional tax offices; and citizen-facing systems such as the Nagarik App and the National ID Information System.

But the proliferation of digital platforms has not been matched by the infrastructure, interoperability and technical capacity needed to sustain them. In several documented cases, system failures have shut down entire public departments for weeks or even months, disrupting commerce, legal transactions and routine civic activities.

NID becomes a national bottleneck

At the centre of the latest disruption is a growing crisis in the central National Identity Card database operated by the Department of National ID and Civil Registration.

Designed as Nepal’s single source for biometric and demographic verification, the NID system has become a potential single point of failure as more services make NID verification mandatory. Banks, telecommunications companies, the Department of Transport Management and the Department of Passports send automated verification requests to the central database rather than storing raw biometric data locally.

The rapid expansion of connected agencies has, however, overwhelmed the system. Department officials say its primary storage and biometric-matching engine, the Multi-Biometric Server Infrastructure (MSI), has reached total saturation.

Designed in 2018 to handle up to 6,000 real-time verification requests per hour, the system now struggles to process just 600 to 700 requests a day, creating queues at public offices nationwide.

Information technology experts say the breakdown was predictable because capacity was not expanded alongside demand.

Vivek Rana, a senior information systems architect, said the government connected high-traffic systems to the central server without adequate investment in processing, storage and hardware.

“Over the past few years, high-traffic public and private sector systems were aggressively tethered to the central NID server without any corresponding investment in expanding the system’s processing bandwidth, data storage capacity, or server hardware,” Rana said. “When thousands of simultaneous verification requests hit the central server during peak business hours, the infrastructure simply collapses under the load, causing severe verification delays or complete system lockouts.”

Rana said the problem also reflects architectural incompatibility. Older government platforms often use XML-based Application Programming Interface (API)s while newer applications use RESTful models. Connecting them requires middleware to translate between the systems, which can slow processing and introduce instability when query volumes rise.

The result is an architecture where adding more services to a central system can increase, rather than reduce, the risk of failure.

Nationwide administrative paralysis

The crisis extends beyond identity services. Repeated failures of government software have disrupted critical sectors and, at times, brought essential services to a standstill.

At Tribhuvan International Airport, repeated crashes of immigration servers have delayed international flights, stranded passengers and forced officers to use paper records, creating security concerns.

The Department of Land Management and Archive faced a similar crisis last month when its Public Access Model (PAM) software failed, bringing down servers at Land Revenue Offices in all 77 districts. Land transfers, property registrations, mortgage processing and bank loans backed by property collateral were halted for weeks, freezing millions of rupees in transactions.

Transport services have also been affected. A three-week outage of the Department of Transport Management’s Electronic Driving Licence (EDL) and Vehicle Registration System (VRS) prevented citizens from applying for or renewing licences, adding vehicle categories, paying road taxes and scheduling driving examinations. The resulting backlog remains unresolved.

Anatomy of systemic failure

IT and e-governance experts attribute the recurring failures to flawed planning, weak system design and an outdated procurement model that treats complex software projects like traditional construction contracts.

Monohar Kumar Bhattarai, an e-governance specialist and former government IT policy adviser, said agencies focus on procurement rather than the full operational lifecycle of technology.

“Government agencies spend months navigating complex tender processes, but pay virtually no attention to how a system will perform over its entire operational lifecycle,” Bhattarai said. “Contracts are regularly awarded without establishing binding service-level agreements (SLAs), operational uptime guarantees, or clear maintenance frameworks. When you ignore the comprehensive lifecycle of information technology, catastrophic failures become guaranteed.”

Rana said fundamental design requirements, including expected users, peak traffic, storage and security needs, are often overlooked. Digital projects are frequently launched without feasibility studies or capacity forecasts.

Government IT personnel in Singha Durbar privately acknowledge that some projects are initiated to demonstrate visible progress, while long-term budgets for maintenance, upgrades and patching are neglected.

“Several years ago, while stationed in the remote mountain district of Humla, I oversaw the procurement and installation of approximately 80 million rupees worth of specialised server hardware across 14 regional land revenue offices,” a senior government IT officer said, speaking anonymously.

“However, over the next eight to ten years, not a single rupee was allocated to upgrade, service, or maintain those machines. Today, that expensive hardware is entirely obsolete and non-functional.”

The officer said officials are also reluctant to seek upgrade funds because of possible administrative scrutiny or corruption investigations.

“Technical personnel often struggle to convince non-technical ministry secretaries of the invisible necessity of software maintenance, leading the government to consistently starve systems of operational funding,” the officer said.

The foreign vendor lock-in trap

Flawed planning is compounded by heavy dependence on foreign technology firms and private contractors for critical government systems.

Nepal’s National Identity Card system, for example, was built using proprietary technology supplied by French multinational Idemia, formerly Oberthur Technologies and now IN Group. Because the platform is closed-source, the government does not own the underlying source code or database design.

Department engineers are therefore unable to independently modify the software, expand database fields or resolve internal bugs. Even minor technical problems can require assistance from Idemia’s technical team in France. Officials privately complain that vendors treat Nepal as a low-priority client, with delays in deploying technical fixes leaving public services disrupted for days.

The vulnerability extends beyond NID. A Ministry of Finance investigation report on Systemic Improvements in Information Technology for Public Financial Management found that dozens of critical government platforms remain heavily dependent on external contractors.

The report said ministries acquired proprietary software over two decades through foreign aid programmes funded by institutions including the World Bank and the Asian Development Bank. Systems deployed across the Ministry of Finance, Financial Comptroller General Office, Department of Customs and Department of National ID were often acquired without source codes or technical documentation.

Clause 3.3 of the report states: “Ministry departments and subordinate agencies display an excessive dependency on external service providers for the operation, maintenance, development, and upgrading of their core IT systems. Critical technical operations—including system configuration, database troubleshooting, security patching, and structural upgrades—are handled almost exclusively by external contractors.”

Paying for hardware, neglecting software

The problem is worsened by the government’s reluctance to purchase formal Software Support Contracts (SSC) after acquiring software. While offices routinely sign Annual Maintenance Contracts (AMC) for physical equipment, continuing software support is often avoided because of annual fees.

“When a government department refuses to purchase a software support contract, internal staff are left completely helpless when the software encounters a bug or database corruption,” IT expert Rana said. “Civil servants are forced to rely on trial-and-error troubleshooting, or informally plead with private technicians and acquaintances for off-the-record advice to keep national databases running.”

International vendors typically charge annual support fees of 15 to 20 percent of the original software cost. For specialised systems such as the Debt Management and Financial Analysis System (DMFAS), annual support can cost $150,000 to $350,000, making approval of recurring payments difficult under current budget rules.

Without support, systems can miss security patches, operating-system updates, database backups and bug fixes. SSL certificates, software licences, firewall subscriptions and antivirus services can also expire.

The Department of Printing’s web portal, which archives national gazettes, parliamentary acts and government ordinances, illustrates the problem. Its expired SSL certificate has caused browsers to flag the official legal repository as an “Unsecure Site” and blocked some users on secure networks from accessing public legislation.

Statutory hurdles and human-resource shortages

Government IT officials have long argued that the Public Procurement Act is poorly suited to rapidly changing technology. Although recent rules allow offices, in principle, to allocate up to 20 percent of a software system’s initial cost for annual maintenance, service contracts can still require lengthy 21-day or 30-day bidding processes. A critical system can therefore remain paralysed while procurement is completed.

The rules also provide limited mechanisms for assessing specialised software or calculating full lifecycle costs. Procurement committees often select the lowest bidder under the L1 model, leaving agencies with cheap, insecure or poorly developed systems.

The regulatory weakness is compounded by a shortage of skilled IT professionals.

Govinda Ram Paneru, an IT under-secretary at the Ministry of Finance, said the government lacks the expertise needed to manage complex digital infrastructure.

“Managing an enterprise-grade digital infrastructure is like running a major tertiary hospital; it requires highly specialised medical professionals across different disciplines,” Paneru said. “Similarly, a robust digital government requires specialised domain experts, system architects, senior programmers, database administrators, and cybersecurity specialists. Nepal’s civil service suffers from a structural absence of such technical expertise.”

Government IT units are often severely understaffed. The Department of Transport Management, for example, manages driving licences, vehicle registrations and road-tax records for millions of vehicles but has only three technical employees.

Frequent transfers also weaken institutional memory, forcing incoming officers to spend months understanding legacy systems before being able to address problems.

“The state harbours grand ambitions of delivering seamless digital governance, but makes zero investment in cultivating internal technical capacity,” Paneru said. “The government attempts to run massive national databases relying on a single computer engineer.”

Much of the underlying infrastructure is also obsolete. Most government data-centre servers and operating systems are seven to eight years old and have reached “End-of-Life” or “End-of-Support” status. Manufacturers have discontinued support and replacement parts, yet agencies continue operating the equipment because replacing it can trigger bureaucratic scrutiny.

The imperative for structural reform

Experts and senior officials say superficial fixes cannot address the structural weaknesses undermining Digital Nepal.

The first priority should be moving away from fragmented servers housed in individual ministries towards a unified national cloud architecture. Modern cloud systems can scale resources with demand, balance workloads and maintain secondary-server redundancies, reducing the risk that traffic spikes will bring down critical services.

The government should also reduce dependence on proprietary foreign technology by adopting open-standard frameworks. While complex core engines may still need to come from global vendors, secondary modules, citizen interfaces and API connectors could be developed locally using open architecture, giving Nepali engineers greater control over system integration and modification.

Experts say the government must reform the Public Procurement Act to reflect the software lifecycle, establish competitive salaries to attract and retain skilled technology professionals, and require regular technical audits and performance evaluations of active government databases.