We are living in an electronic age. Online space in Nepal is an increasing trend. Similarly, technology has also influenced the way we interact with banks. Internet banking/e-banking in Nepal is increasing as more and more people are starting to do transactions online.
Internet banking/e-banking is an electronic payment system that enables customers of a bank or financial institution to conduct various financial transactions through the financial institution’s website. You can obtain your account balances, a list of recent transactions, additional utility bill payments, and funds transfers between a customer or another’s accounts using internet banking. You can access all these facilities anytime using your mobile or computer. It’s less time-consuming and very safe and secure.
Kumari Bank was the initiator of internet banking in Nepal. It started its e-banking services in 2002. Since then, internet banking in Nepal has grown by leaps and bounds. Also, Nepali banks have become hugely proactive in promoting internet banking and electronic payments.
In a country like Nepal, having rugged topographical terrain, internet banking acts as an accessible medium to reach out to customers in the hinterlands.
Financial institutions in Nepal are serving nearly 4 million mobile banking customers and 0.78 million internet banking customers, as per the recent data from Nepal Rastra Bank. The adoption is pretty slow, it seems. Only 2% used the internet to buy something online in the past year. Only 1.13% of the adult population has used internet banking to pay bills. However, 16% made or received digital payments in the past year. It shows that people are going cashless, though very slowly.
When only 45% of the adult population has a bank account, banking and financial literacy are essential for the growth and adoption of internet banking in Nepal.
As per NTA data from mid-September 2018, 53.12% of the population (15.58 million) has access to broadband internet in Nepal.
Some of the services accessible through Internet banking in Nepal are:
Online tax payment
access the account to check the balance,
online trading of shares,
online remittance of money,
electronic bill payment system,
transfer of funds from one customer’s account to another, etc.
With smartphone penetration sharply increasing due to competition in the telecom space, cost-effective models being available, and expansion of Wi-Fi/4G/3G networks, mobile and internet banking is expected to see accelerated growth in Nepal.
Internet banking in Nepal is set to become the catalyst for change in how money moves. Online banking means access to banking anytime, anywhere. Internet banking can create a whole new set of customers who do not have access to formal banking. Mobile phones provide penetration and an entry into a customer segment that banks could not earlier reach, ultimately increasing access to banking and financial inclusion in Nepal.
The government has decided to implement the Electronic Payment System to pay its expenditures and collect revenue. Now, it is possible to pay all forms of taxes to the government from your mobile phone. In the first phase, the system is currently available at the Taxpayers’ Office in Thamel. The government promotes internet banking and digital payments and ultimately plans to move towards less cash and a cashless society.