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Digital Economy in Nepal: Opportunities, Risks and Challenges
Digital Economy in Nepal: Opportunities, Risks and Challenges
• 60% citizens have access to formal and informal banking services including
cooperatives
• 2 Major MNOs hold over 95% market shares of mobile phone services
• About 5 million Debit Cards in circulation (Visa, MasterCard, SCT, NPN etc)
• 1,700 plus ATMs and Estimated 12,000 plus POS (Point of Sales) Terminals
INFRASTRUCTURE FOR DIGITAL FINANCIAL SERVICE
• Shared switches and individual switches installed by banks & card operators
• Central Bank instruction to migrate to EMV Card for all issuers (larger % migrated)
• Central Bank in process of installing RTGS and CSD to meet BIS requirements
• Central Bank issued Payment and Settlement Bylaws, Licensing Policy for
Payment Service Providers and Payment System Operators
• DFS creating access to financial services even in rural Nepal for unbanked and
underbanked population
• 3 Licensed PSPs are aggressively expanding the agent networks through out the
country
• High growth in use of social media and internet access is creating opportunity
for wider coverage of population in online business
• People see value in using DFS for different Utility payments and Top ups
• DFS in introductory stage and hence huge opportunity of growth both in urban
and rural Nepal
RISKS AND CHALLENGES FOR DIGITAL FINANCE
• Difficult geographical terrain and poor connectivity in the larger remote Nepal
• Weak enforceability and support of Government to roll out DFS against strategy
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