National Reconstruction Authority (NRA) Signs Service Agreements with 29 Banks and Financial Institutions (BFIs) for Fund Distribution in Earthquake-Affected Districts; Signings with Other BFIs to FollowJune 1, 2016
May 30, 2016 – At an event organized today at the NRA’s Head Office in Singha Durbar, 29 BFIs out of a total of 62 BFIs with physical presence in the earthquake-affected districts, signed individual contracts with the NRA. The 29 BFIs who signed included 20 Class A commercial banks, 8 Class B development banks and 1 Class C financial company. The remaining BFIs are expected to sign contracts with NRA within the next 2 days.
Today’s developments have paved the way by the government for the adoption of banking channels to distribute relief payments, making the entire process more secure and more transparent. It also heralds the introduction of over 500,000 Nepalis into the formal financial sector with bank accounts to be opened for each to receive these funds through bank branch locations. Besides the distribution of funds from the government, the beneficiaries can then begin to enjoy a large array of other financial products and services provided by these BFIs.
In his welcome remarks to the over 50 banking professionals and NRA staff gathered at the signing ceremony, Mr. Sushil Gyawali, CEO of the NRA said, “This is the result of the hard work put in by the NRA team with the banking community to institute an efficient and transparent process for the deployment of government and private banks and financial institutions to expedite relief payments to the beneficiaries in the earthquake-affected districts. We firmly believe that the use of banking channels for this distribution will not only help Nepal build back better but also accord the opportunity to the underserved to be brought into the formal financial system. For this I thank the Nepal Rastra Bank, the leadership of the bankers; development banks and finance companies associations, as well as the UKaid Sakchyam programme for their support and commitment to ensuring the success of our objectives.”
Speaking on behalf of the BFI industry, Mr. Upendra Poudyal, President, Nepal Bankers’ Association, and CEO, NMB Bank Limited said, “Nepal’s banking and financial institutions’ sector is trustworthy and dependable. When we take up a responsibility, we deliver on it. I would like to thank the NRA for using the banking channel and entrusting us with this huge responsibility of ensuring that funds reach the earthquake-affected communities safely and on time.”
Following the culmination of the signing event, Mr. Baljit Vohra, Team Leader, UKaid Sakchyam remarked, “This is the fruition of over a year of work put in by UKaid Sakchyam as part of its response to the Gorkha Earthquake. The work that has now begun – access to financial services for earthquake-affected communities – is rooted in our programme’s belief that the reinstatement of delivery channels for financial services is an empowering and crucial intervention. We are also excited that this initiative comes close on the heels of the recently announced national budget, wherein the Government has stated its intention to make social security and other G2P payments through banks. Sakchyam’s initiatives, aimed at deepening the goals of financial inclusion including its support to the NRA and BFIs, are aligned with the government’s stated goals for enabling bank accounts for its citizens as well as distributing relief payments in a transparent, efficient and secure manner.”
Present at the event were senior representatives from the NRA, Nepal Bankers’ Association, Development Bankers’ Association Nepal, Nepal Financial Institutions’ Association, the BFIs and the Sakchyam Access to Finance Programme.
Sakchyam is an access to finance programme funded by UKaid. It is being implemented by Louis Berger for DFID Nepal in partnership with local and international institutions. Sakchyam works closely with the Nepal Bankers Association, the Development Bankers Association of Nepal and the Nepal Financial Institutions’ Association that represent the interests of Class A, B and C BFIs in Nepal respectively.