Nepal Banking Sector Challenges 2026

Police arrested a 28-year-old man from Dhanusha over alleged illegal cryptocurrency trading worth Rs 2.16 billion. Investigators said the case involved large-scale betting and crypto transactions through electronic platforms and online applications.

Nepal Police said it is preparing an integrated anti-scam center at the Cyber Bureau to stop fraudulent transfers before stolen money disappears. Officials said complaints over the past three fiscal years involve more than Rs 4 billion in alleged scam-related losses.

Nepal Rastra Bank temporarily suspended four online services, including the Grievance Hearing Portal, NCTS, LC and FXOL systems, citing cybersecurity risks tied to PHP vulnerabilities reported worldwide. The bank said users should use designated email contacts until the services are restored.

Reports said Nepal Rastra Bank’s website remained down even as most other government sites returned online after security patches and testing. The outage continued to disrupt exchange-rate access and some banking and public services, though core banking systems were said to be unaffected.

Most Nepal government websites were brought back online after security patches were applied to the PHP vulnerability, with thousands of portals under the Government Integrated Website Management System centrally patched. Some services, including the Medical Education Commission website and the Nagarik App, remained unavailable.

Thousands of Nepali government and banking websites were taken offline after two critical PHP vulnerabilities were disclosed globally. The outage disrupted public services, bank portals and tracking systems while authorities audited shared platforms and patched systems in stages.

Nepal Rastra Bank and several banks and government agencies temporarily took websites and online services offline after serious PHP security vulnerabilities were identified globally. The precaution affected web-based services, while officials said customer data and core banking systems were not lost or hacked.

Nepal temporarily took government websites offline after two critical PHP vulnerabilities were disclosed that could allow remote code execution on affected servers. The National Cyber Security Centre urged organisations to patch or isolate vulnerable systems while emergency updates were applied.

Reports said Dashain festivities had begun and digital transactions were rising sharply as banks, wallets and QR payments were used more for tika and dakshina. The article urged cashless payments while warning about OTP theft and phishing risks.

Nepal Rastra Bank warned the public to stay alert for digital fraud during Dashain, saying scammers may exploit reduced banking hours. It told people not to click unknown links, share OTPs or credentials, or scan QR codes for supposed money transfers.

Authorities urged online shoppers to ask for VAT bills, pay after delivery where possible and send money to company accounts rather than personal ones. The guidance followed a rise in social-media scams on TikTok, Instagram and Facebook and calls for faster complaint handling and tighter registration of sellers.

Home Minister Sudhan Gurung said the government will introduce new legislation to reform Nepal Police and modernize the force. He said the police should strengthen cybercrime, digital forensics and financial crime investigation capabilities.

Nepal Police registered 20,526 cybercrime-related complaints in fiscal year 2025-26, underscoring a sharp rise in online fraud, harassment and abuse. The article says response capacity needs to extend beyond the Cyber Bureau in Kathmandu to local police stations nationwide.

Nepal Rastra Bank directed banks, financial institutions and payment service providers to appoint round-the-clock contacts and share them with the Nepal Police Cyber Bureau during the Dashain, Tihar and Chhath holidays. The central bank said the move is meant to speed up freezing suspicious accounts and stop stolen funds from being withdrawn or transferred.

Nepal Rastra Bank directed banks and financial institutions to tighten monitoring for cyber fraud and scams during the Vijaya Dashami, Deepawali and Chhath holiday period. It also told them to designate focal persons, share contact details with Nepal Police Headquarters and hold suspicious accounts or transactions when needed.

Nepal Rastra Bank extended the repayment deadline for flood-affected entrepreneurs, including borrowers in the Bhotekoshi and Budhigandaki river areas, to mid-January 2027. Banks were also told to assess borrowers’ finances before extending principal or interest payments and to assign fraud contacts during the festival period.

Police in Rautahat arrested three suspects, including an Indian national, over an alleged Rs 4.98 million KYC scam targeting mobile banking and digital wallet users. Investigators said the group impersonated bank and e-wallet staff, with at least 22 complaints linked to the case.

The Securities Board of Nepal said it would observe World Investor Week 2026 from October 5 to 11 with nationwide programs on investor education, financial literacy and digital fraud awareness. The campaign involves NEPSE, CDS and Clearing Limited and other market institutions.

Three ministers backed sweeping legal reforms linked to the Nepal Infrastructure Conference 2026, saying the government plans to introduce 27 new laws this fiscal year and has already repealed 15 outdated Acts. The government also said it will register 166 bills in Parliament as part of a declared Year of Lawmaking and Reform.

SEBON Chair Gopal Prasad Bhatta said policy and legal reforms are underway to make Nepal’s capital market more organized, transparent and investment-friendly. The Finance Committee meeting also reviewed securities issuance, listing, regulation and investor protection measures under the 21-point action plan.

SEBON Chair Dr Gopal Prasad Bhatta said reforms are underway to make Nepal’s capital market more transparent, credible and investment-friendly. The Finance Committee also discussed legal updates on securities issuance and listing rules, along with investor protection and technical improvements.

The Securities Board of Nepal unveiled a three-phase strategy for primary and secondary capital markets, covering policy reform, infrastructure development and institutional strengthening. The plan includes new rules for IPO issuance, price discovery, qualified institutional investors, allotment systems, broker restructuring, and stronger NEPSE and CDSC oversight.

The House Finance Committee scheduled discussions with SEBON, NEPSE and other stakeholders on making Nepal’s capital market more transparent, reliable and investor-friendly. The agenda includes securities issuance, listing, market operations, regulatory effectiveness, investor protection and policy reforms.

Nepal took charge as vice chair for the non-regional member countries of the Asian Infrastructure Investment Bank for a one-year term. Wagle formally assumed the role in Doha and called for more flexible financing for roads, electricity and technology in developing countries.

Finance Minister Dr Swarnim Waglé was elected Vice-Chair of the Asian Infrastructure Investment Bank for the 2026–27 term at the annual meeting in Doha. The role could help Nepal expand concessional financing and investment for infrastructure, energy, communications and IT.

A report said NEPSE has continued to decline despite a wave of capital market reforms, dropping from about 2,950 points to 2,613.33 by September 28. The article highlighted the gap between policy changes and investor demand, even after new rules on margin lending and share holding periods.

Finance Minister Swarnim Wagle met AIIB President Zou Jiayi in Doha and sought more investment in Nepal, concessional financing and support for post-flood reconstruction. The AIIB said it would back recovery efforts and consider grant-backed project preparation and highly concessional loans.

Finance Minister Swarnim Wagle met AIIB President Zou Jiayi in Doha and sought expanded investment, concessional financing, and disaster-recovery support for Nepal. The AIIB said it would support resilient reconstruction and consider grant assistance for project preparation.

SEBON proposed introducing intraday trading in phases, starting with a buy-first, sell-later model for liquid securities. The draft also calls for tighter risk controls, surveillance, and advance disclosure rules for large shareholders before major sales.

A cyber attack on Data Hub’s data center halted stock market trading in Kathmandu and delayed the opening after a public holiday. Regulators and police launched investigations as concerns grew over investor data and market security.

NEPSE resumed regular share trading after the data center issue was resolved. SEBON ordered NEPSE to investigate the disruption and submit corrective measures to prevent a repeat.

NEPSE said regular trading would resume after the technical problem at Data Hub Pvt. Ltd. was resolved. Trading had been suspended on Ashwin 5 after the issue emerged at the data center serving 72 trading member companies.

Reports said repeated technical failures at NEPSE have disrupted trading, shaken investor confidence, and exposed more than Rs 4.5 trillion in assets to risk. The latest outage was linked to a ransomware attack at Data Hub Pvt Ltd, which hosts systems for 72 broker firms.

NEPSE halted regular trading after a technical glitch affected servers and trading systems used by 72 broker companies. The shutdown exposed concentration risk around a single private data center and raised concerns about market disruption and losses.

The Office of the Prime Minister and Council of Ministers asked 21 private sector organizations to submit proposals for legal reforms within five days. The request focused on laws, regulations and procedures that obstruct business and investment, with groups saying implementation will matter more than the proposal exercise.

NEPSE suspended stock transactions after a technical problem at Data Hub Pvt. Ltd. disrupted trading systems used by 72 brokerage firms. The outage began around 4:00 am on September 20 and trading remained halted while the issue was unresolved.

Nepal’s capital market posted weekly gains after the government’s 21-point revival action plan, with NEPSE rising 87.73 points and total market capitalization increasing by about Rs 139 billion. Investors welcomed the reform package and lower capital gains tax, though execution concerns remained.

NEPSE rose 48.57 points to 2,633.62 after the capital market revival plan boosted investor sentiment, with trading worth over Rs 8.29 billion across 347 companies. The report said the plan and lower capital gains tax helped lift the market, though trading remained volatile.

The Ministry of Finance unveiled a 21-point Capital Market Strengthening and Revival Action Plan to restore investor confidence and make Nepal’s capital market more competitive and transparent. The package includes IPO reforms, NEPSE restructuring, new bond-market rules, broader institutional participation, and legal changes for margin lending, intraday trading and short selling.

The Ministry of Finance unveiled a 21-point Capital Market Strengthening and Revival Action Plan to restore investor confidence and improve market competitiveness. The package includes IPO reforms, NEPSE restructuring, new bond-market rules, broader institutional participation, and legal changes for margin lending, intraday trading, and short selling.

Stakeholders at Nepal Capital Market Discourse 2026 called for structural reforms, new financial products, stronger surveillance and more investor education. SEBON said it is preparing an AI-based supervision system and new rules to diversify the market beyond ordinary share trading.

SEBON proposed draft Bond Registration and Issuance Regulations, 2083, requiring at least Rs 1 billion in capital for bond issuers. The draft also broadens access beyond banks and financial institutions while adding secured-bond, rating, trustee and collateral requirements.

SEBON released draft Debenture Registration and Issue Regulations, 2083 B.S. for public consultation. The proposal would allow eligible corporate companies to raise long-term funds through bonds and debentures as part of Nepal’s broader capital market reform agenda.

The government said it is preparing regulations to legalize peer-to-peer lending through Nepal Rastra Bank within the current fiscal year. The framework is slated for inclusion in the upcoming Payment and Settlement Bill.

SEBON said it is preparing new market products, clearer trading rules, and stronger regulatory guidelines to modernize Nepal’s capital market. Brokers are also pressing for securities law changes and an Auto-EDIS system for smoother settlement.

Parliamentary Finance Committee members were scheduled to discuss a bill to amend the Nepal Rastra Bank Act, 2058, with the finance minister and finance secretary invited. The meeting was part of a broader round of committee hearings on legislation and governance.

The Prime Minister’s Office directed ministries and agencies to implement Nepal’s FATF action plan on fixed deadlines and under regular monitoring. Officials said the country aims to complete the required reforms by mid-February 2027 to exit the grey list.

SEBON Chair Dr. Gopal Prasad Bhatta met the IMF’s Nepal resident representative in Lalitpur to discuss capital market reforms, transparency, and institutional strengthening. The IMF said it would continue supporting Nepal’s financial sector and related policy coordination.

SEBON drafted a new margin lending regulation that would allow eligible investors to borrow against their equity and introduce intraday trading, securities lending and borrowing, and covered short-selling. The proposal is now open for public consultation.

Nepal Rastra Bank said it would raise Rs 20 billion through a 35-day deposit collection instrument, again using online bidding. The auction will allocate funds to the lowest-rate bids, with pro-rata allocation if needed.

SEBON unveiled the Primary Capital Market Reform Policy 2083 to modernize Nepal’s primary capital market through legal reforms, digital issuance, market-based pricing, and stronger investor protection. The policy aims to expand long-term financing for industries, SMEs, infrastructure, and green projects.

Nepal Rastra Bank announced a Rs 30 billion deposit collection from banks and financial institutions through bidding, with repayment due in September 2026. The central bank said the 35-day instrument would be allocated to the lowest interest-rate bids.

Nepal Rastra Bank said it would collect Rs 60 billion through a 31-day deposit auction to manage banking-system liquidity. Eligible Class A, B and C banks and financial institutions were told to bid through the online system.

SEBON released a white paper for the long-term development of Nepal’s primary capital market, outlining legal amendments, institutional upgrades and a three-phase reform plan over five years. It proposes a Digital IPO Platform, e-KYC, RegTech, SupTech and market-based price discovery.

Nepal Rastra Bank announced it would collect NPR 85 billion in three-month deposits from banks and financial institutions through online bidding. The move was aimed at absorbing excess liquidity and managing monetary conditions.

SEBON formed a seven-member Primary Market Reform Facilitating Task Force under its FY 2083/84 agenda. The group will review IPO allocation, book-building, digital IPO systems and investor participation.

Nepal’s finance minister said the market will be restructured with phased introduction of intraday trading, short selling and derivatives. The comments came as investors pressed SEBON for reforms to make NEPSE less one-way.

Nepal Rastra Bank decided to collect Rs 25 billion through a 61-day deposit instrument to manage excess liquidity in the banking system. Banks and financial institutions were invited to bid through the online system, with rates set by auction.

Global IME Bank launched an app-based service that lets Nepali citizens open savings accounts online through the Citizen App using their National Identity Card. The service reduces paperwork and retrieves customer information with user consent.

Nepal Rastra Bank amended its Integrated Payment System Directive to require payment service providers to verify digital wallets with the National Identity Card system and have users update wallet details by the end of Ashwin 2083. The change formalizes ID-based compliance for wallet openings and updates.

Five commercial banks including NIC Asia and Himalayan Bank suspended advance employee bonuses in 2026, pending audits and regulatory approvals amid rising non-performing loans and losses.

Nepal Rastra Bank relaxed the mandatory National ID requirement for bank accounts, extended the compliance deadline to Ashwin 2083, and said accounts will no longer be automatically frozen for missing ID details. Banks must instead send periodic reminders, and non-resident Nepalis can open accounts online without an ID until they update it after returning.

Nepal Rastra Bank collected Rs 50 billion to manage liquidity; fiscal year 2026/27 budget of Rs 2.12 trillion commenced focusing on macroeconomic stability; NEPSE stock index rose 3.06%.

Nepal's non-performing loan ratio increased from 1.48% in 2021 to 4.62% by mid-2025, with unrecoverable loans rising and sectors like fishery and construction most affected, indicating financial stress.

Nepal Securities Board unveiled a plan to double capital market size relative to GDP by 2036, introducing AI, blockchain, new financial instruments, and full digitization including a unified Capital Market Super App.

Nepal’s banks and financial institutions held Rs 1.56 trillion in excess liquidity due to weak credit demand and slow economic activity, with credit-to-deposit ratio at 71.29%.

Nepal Rastra Bank announced increased margin lending loan-to-value ratios, extended contractor loan relief, extended working capital deadlines, and eased National ID rules for migrants and children.

Nepal’s banks hold Rs 7,261.75 billion in deposits but lent only Rs 5,262.45 billion; non-performing loans quadrupled since 2021/22, reaching a 5.6% gross ratio by April 2026.

Nepal’s commercial banks reported 19.62% net profit growth amid 3.85% economic growth slowdown, while non-performing loans rose to 5.41% and credit-to-deposit ratio fell to 72.91%.

Nepal Rastra Bank directed banks to reduce dormant accounts by mid-2026, requiring amended regulations and regular customer notifications via phone, SMS, or email.

Nepal Rastra Bank increased loan limits for private housing from Rs. 20 million to Rs. 30 million with 80% loan-to-value ratio, and doubled personal overdraft limits from Rs. 5 million to Rs. 10 million to boost consumption.

Nepal Rastra Bank announced its monetary policy targeting 5.5% inflation and 11% credit expansion to the private sector, promoting specialized banking and encouraging digitization of services.