286 Branchless Banking Points to Open in Underserved Regionsthrough Ukaid Sakchyam – Commercial Bank Partnerships

October 5, Kathmandu – At a special event held at Hotel Annapurna, Honorable Governor Dr. Chiranjibi Nepal presided over the signing ceremony for the Sakchyam Access to Finance Programme partnerships with seven commercial banks.These partnerships will roll out the opening of 173 Branchless Banking (BLB) Points in the 14 districts affected most severely by the Gorkha Earthquake.As part of this partnership, Citizens Bank, Global IME Bank, Nepal Investment Bank, NMB Bank, Rastriya Banijya Bank, Sanima Bank and Siddhartha Bank have already setup 55 BLB points with the remaining to be established by the end of November 2015.  The launch of these crucial financial services comes at a point where the financial sector is under pressure to provide quick access to financial services in far flung areas of the 14 districts.

In thanking Sakchyam and partner banks, Dr. Chiranjibi Nepal said, “In line with its monetary policy, NRB is moving aggressively to expand BLBs throughout the country. Partnerships such as the ones forged by Sakchyam and the discussions today are critical to NRB’s strategy.  We are committed to working with our banks and the Government to provide a sustainable basis for expanding our goals of financial inclusion and expediting G2P payments in an efficient manner”.

Representing the Ministry of Finance, Joint Secretary Mr. Surya Acharya said “The establishment of delivery points and making them sustainable is key. The Government, as part of its recently announced budget, intends toestablish the right incentives for banks working with NRB to rollout G2P and other cash transfer programmes, through networks such as the ones created by banks with Sakchyam support”.

 

Mr. Basanta Raj Gautam, Director General, Department of Civil Registration, Ministry of Federal Affairs and Local Development (MoFALD) remarked,“The government is working to finalise the pricing structure to use for working with banks. We have had presentations from Sakchyam on the basis for pricing and we have been looking at international as well as our own experiences to-date. It is our intent to work closely with the banks to develop a sustainable model for delivery of G2P services.”

 

Reiterating the Government of UK’s commitment to accelerate the deepening of access to financial services in rural Nepal, Mr. Gareth Weir, Economic Development Team Leader, DFID said,“We are pleased by the active deliberation between the NRB, MoFALD, MoF and NBA to enable retail finance and G2P payments through the banking sector.  Through Sakchyam and working with MoF, DFID stands fully committed to supporting NRB in its goals to expand BLB in a big wayand modernize its payment systems”.

Briefing the invitees on Sakchyam’s achievements in its first programme year, Mr. Baljit Vohra, Sakchyam Team Leader said,“Sakchyam is supporting 286 BLB openings in the mid- and far-west and in earthquake-affected districts. Thistransformational BLB strategy includes the use of Point of Sale (POS)machines, mobile phonesand tablets enabled through agents, extensions counter and physical branches to rollout micro-banking products, G2P paymentsand value chain financing models that will further deepen financial-service penetration for households and enterprises in the remotest areas of the country”.

A spirited discussion followed between Nepal Rastra Bank, the Ministry of Finance, Ministry of Federal Affairs and Local Development, the Nepal Bankers’ Association and DFID on recommendations made for expediting relief and G2P (Government to People) payments through commercial banks on a costed basis.

Sakchyam is an Access to Finance initiative funded by UK Aid and implemented in Nepal by Louis Berger, for DFID Nepal in partnership with local and international organizations.