Central Bank Unveils Intriguing Data: 67.3% of Nepalese Have At Least One Bank Account; Women Are More Actively Involved in Banking Than Men

This is a summarized excerpt of the research report published by the central bank.

Nepal's central bank, NRB, claims that promoting financial inclusion is one of its major objectives. NRB has been taking various policy measures to broaden financial access. Promoting financial literacy, incentivizing the opening of branches in rural areas, launching open bank account campaigns, easing the operation of branchless banking, increasing focus on modernization of payment systems are some recent measures to expand financial inclusion.

As a result, the number of deposit accounts has been expanding substantially. The population with at least one account is estimated to be 67.3 percent in mid-June 2020 in this report compared to the estimate of 60.9 percent in mid-July 2019. The number of local levels without branches of commercial banks have come down to 3. The total numbers of deposit accounts in BFIs are 36,366,041 and loan accounts are 1,682,845 as of mid-April 2021.

This study has further helped identify the gap in financial access across geographical and demographic dimensions. NRB conducted this study to explore the features of deposit accounts in A, B, and C class BFIs. The study is based on details of 32.1 million deposit accounts - 83.3 percent accounts maintained at 27 commercial banks, 14.7 percent at 23 development banks, and 2.0 percent at 22 finance companies as of mid-June 2020. The population with at least one account is estimated to be 67.3 percent compared to the estimate of 60.9 percent in mid-July 2019. The branches per 100,000 populations are found at 18.98. The density of BFIs branches in urban areas is high whereas in rural areas and mountain districts are low.

The total number of accounts per 1000 adults is 1348.1. The variations in accounts per 1000 population across provinces are high. The male population holds a relatively higher number of accounts compared to the female population. Women from rural municipalities have the lowest number of accounts per 1000 population. Individual accounts constitute 93.48 percent of the total deposit accounts.

Among non-financial corporations, small and other than small business enterprises have 848,000 accounts. One-third of the total deposit accounts are found to be dormant. The proportion of dormant accounts is higher for non-financial institutions compared to individual accounts.

Sudurpashchim province has relatively fewer dormant accounts compared to other provinces. Female accounts are less dormant compared to male accounts. Rural municipality has a relatively low percentage of the dormant account compared to other types of local levels.

Saving accounts are the highest number of deposit accounts. A high number of current and call deposit accounts are held by institutions than individuals. The share of account holders using mobile banking, ATM, and internet banking is 32.03 percent, 20.35 percent, and 3.86 percent respectively.

Mobile banking is used uniformly across all provinces. Metropolitan cities record the highest percentage of ATM and internet banking users. Male account holder's usage of fintech is higher compared to female account holders. The account holders of young age use ATM and mobile banking at a higher rate. The proportion of fintech users decreases with higher age.