Banking System in Nepal

There are many commerical banks, development banks, financial companies, and micro credit development banks are working under central bank. Central bank controls the monetary aspect of the contry. Banking system regulation and fuctioning as a government's central bank along with the central bank, Nepal Rastra Bank (NRB) controls exchanges of foreign currency, supervision, monitoring and governing every activities of banking and non-banking activities of financial institution. The determination of interest rates for proving to people as commercial and exchange of forign currency as well falls under the responsibility of Nepal Rastra Bank. Along with this NRB kept records of all government income and expenditure in the account, issues bills and treasury notes, as well as provides loan to the government, and decide monetary policy.

Banking System in Nepal-- Central Bank of Nepal
Central Bank of Nepal, Nepal Rastra Bank


Commercial bank, Development Banks and Financial Institution are establishing in Nepal under the Bank and Financial Institution Act 2006 issued by NRB.
Modern History of Banking system first established in Nepal with the establishment of Nepal Bank Limited in 1937 A.D. King Tribhuwan inaugurated Nepal Bank Ltd. on 30th Kartik 1994 B.S. It was established as a semi governmental bank. It remain only a single financing institution until the establishment of Nepal Rastra Bank in 1956 A.D. Nepal Rastra Bank is established as an institution that issues national currency and promote financial organisations in the country. Before the establishment of NRB only metal currency are in use in monetary transaction. Nepal Bank Limited used to function as centre bank before establishment of NRB.
A good banking system of a country would help to develop the economy of the nation.



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