Nepal Rastra Bank, the UN Capital Development Fund (UNCDF), and the United Nations Development Programme (UNDP) jointly launched the findings from the supply side study and roadmap for financial inclusion in Nepal. The findings were released in a national conference, which was jointly inaugurated by Honourable Dr. Yuba Raj Khatiwada, Vice Chairperson of the National Planning Commission; Dr. Chiranjibi Nepal, Governor of the Nepal Rastra Bank; and Her Excellency Ambassador, Danish Embassy, Nepal, Ms. Kirsten Geelan.

Ms. Valerie Julliand, UN, Resident Coordinator; Executive Secretary of UNCDF, Ms. Judith Karl; Head of UK Aid, Nepal, Dr. Gail Marzetti; and Dr. Govind Nepal, Chief Economic Advisor, Ministry of Finance, were also present in the launching ceremony together with head of other donor agencies, officials from the Government of Nepal, representatives of various financial institutions, private sector and development partner agencies, and media.

The level of financial inclusion in Nepal is better with 61 percent of adults having access to formal finance and only 18 percent completely excluded. However, the actual usage of the financial products is low especially with regard to digital transactions, insurance and credit. Existing financial products are homogenous and do not meet the diverse financial needs of the population.  There is a need for access to low-cost, flexible and diverse financial products, better tailored to the unique needs of the population which can enable individuals to manage their financial lives, increase income, manage risk and build wealth over time. The financial inclusion roadmap serves as an overarching guideline for strengthening the financial inclusion situation in Nepal.

Addressing the launching ceremony, Honorable Dr. Yuba Raj Khatiwada, Vice Chairperson of the National Planning Commission, highlighted that the financial inclusion should be meaningful so that it will contribute in improving the living standards of the people and take the poor people out of poverty. He further added that the efficiency of the financial institutions should be improved so that the institutions would be more competitive.

Dr. Chiranjibi Nepal, Governor of NRB, highlighted that the goal of the financial inclusion should be focused towards raising the quality of the life of poor people and reducing the level of poverty. He further added that financial inclusion has been identified as a strategic priority in Nepal Rastra Banks’s Strategic Plan and it has also been identified as an important pillar in the National Five-year Financial Sector Development Strategy, which is in the process of approval.

Delivering the vote of thanks and closing remarks, Ms. Judith Karl, Executive Secretary of UNCDF, highlighted the role of financial inclusion as a key enabler to achieving the range of development objectives, which can be seen prominently in the 2030 Agenda for Sustainable Development.  She shared that financial inclusion remains a challenge globally, particularly in the least developed countries (LDCs).  “In order to make financial inclusion happen at country level, we need to better understand the market gaps and opportunities through better use of available data.  Through the MAP diagnostic process in Nepal, we’ve highlighted the key market opportunities as well as the potential size of these markets.” Ms. Karl said.

H.E. Ms. Kirsten Geelan, Ambassador, Danish Embassy in Nepal, emphasized the importance of financial inclusion particularly for Nepal to move out of the group of LDCs by 2022.

Head of UK Aid, Nepal, Dr. Gail Marzetti, expressed that these demand and supply side analysis and roadmap for the financial inclusion in Nepal would be important to facilitate the informed decision-making for relevant stakeholders and Government of Nepal to ensure the financial inclusion in Nepal.

Dr. Bhubanesh Pant, Acting Executive Director of Nepal Rastra Bank, welcoming the delegates in the beginning of the programme, briefly shared the findings and suggested road map for financial inclusion for Nepal. He explained six broader areas of recommendations as; (a) unlock constrained credit and savings markets, (b) improve payment systems, (c) bolster risk mitigation capabilities, (d) enhance and leverage locally-based financial service providers, (e) enhance financial inclusion support in state governance and (f) effective consumer empowerment and education.

The Making Access to Finance Possible (MAP) study in Nepal has been implemented by the Nepal Rastra Bank and UNCDF with the funding support from UK Aid and the Government of Denmark. The intended outcome of MAP is to define the financial inclusion agenda in Nepal and align resources with key priorities, based on a rigorous evidence-based diagnostic exercise concluded by the stakeholder dialogue and decision-making. The overall objective of MAP is to find out opportunities, challenges and gaps with regards to the demand and supply side of the financial markets and also to review policy gaps. This will provide an evidence based information at the national level to plan future interventions to support the financial inclusion agenda in Nepal. Findings of the demand side study on financial inclusion in Nepal were launched earlier in August 2015. 

Source: UNDP Nepal.