Latest Payment & Settlement System Development / Measures In Nepal : Presented by : NEPAL RASTRA BANK Kathmandu, NEPAL

Transcription

1 Latest Payment & Settlement System Development / Measures In Nepal -----: Presented by : NEPAL RASTRA BANK Kathmandu, NEPAL 1.

2 Recent Development Total Banks & Financial Institutions In Nepal : Grade Banks & FIs 2012 Nov Nov A Class Commercial Banks B Class Development Banks C Class Finance Companies D Class Micro Fin. Dev. Banks Total :

3 Recent Developments Total Branches of Banks & FIs in Nov :- Banks & FIs Branches Commercial Banks 1497 Development Banks 775 Finance Companies 246 Micro Fin. Dev. Banks 634 Total Banks & FIs : Average Population per Branch : ,475 Total Depositor : Million Total Lonny Million 3

4 Recent Developments Total Deposit & Loan Advances in Banks & FIs:- ( In Billion) Banks & FIs 2010 July 2011July 2012July Deposit Loan & Advances

5 Recent Developments Payment instruments In Practice: a) Traditional Cash Cheque Credit Transfer Direct Debit Draft b) Modern T T Internal Remittance System 5

6 Recent Developments Payment instruments In Practice: c) Electronic: Swift Electronic Clearing House ATM Debit Cards Credit Cards Internet Payment Mobile Payment 6

7 Recent Developments Total Number of ATM & Transaction of Debit and Credit Cards In Banks & FIs :- Banks & FIs In Nov ( In Thousands ) ATM Numbers Debit Cards Credit Card Commercial Banks ,33 40 Development Banks 240 3, Finance Companies Total ,46 40 Total Depositor Number : Million Total Lonny Number : Million 7

8 Recent Developments Electronic Cheque Clearing : Total Electronic Cheque Clearing Number & Amount : Total Cheque July 2012 July 2013 Number In Million Amount In Billion ,344 8

9 Recent Developments Electronic Cheque Clearing : Except daily normal clearing work an express session will be start very soon to assist fast payment & settlement purpose of banking industry. Currently capital city and 2 important commercial city's cheque clearing of Banks & Financial Institutions (FIs) are involve in automated clearing work of NCHL for the purpose of last settlement in NRB centrally. 9

10 Recent Developments Electronic Cheque Clearing : As requirement of the whole banking sector we are going to expand the system to cover all the regions of Nepal for faster and safe cheque clearing within mid year of

11 Recent Developments Standardization of Financial Instrument : NRB has been making effort to bring more efficient clearing and settlement process. Currently NRB is going to launch Magnetic Ink Cheque Recognition (MCIR) in banking sector for standardization of financial instrument with initial emphasis of cheques. 11

12 Recent Developments Standardization of Financial Instrument : This effort will be replace substandard cheque and also prevent to the banks and customers from fraud transaction as well as it will bring more efficiency in cheque clearing process of NCHL. 12

13 Recent Developments Establishment of Payment & Settlement Division : NRB has already established a separate division with an efficient team to enhance electronic payment and settlement system in banking sector of Nepal. This division aims to study and support RTGS system in coming days. 13

14 Recent Developments Branchless Banking Service : Nepalese banks have started branchless banking service to deliver banking service door to door where branch network is not available specially in rural areas. Thus deposit mobilization could be play significant role for intensive banking business in bank less areas. 14

15 Recent Developments Branchless Banking Service : In the same way electronic banking (Ebanking) is emerging as popular banking practice specially in city area's community where banking literacy is high and public are more conscious to save the time and physical movement to reduce unwanted expenses as well as to support eco friendly environment. 15

16 Challenges In P&S System Main Barriers of Payment & Settlement System: Absence of Payment & Settlement Act. Deficiency of Payment & Settlement Policy. Insufficient Payment & Settlement Regulation. 16

17 Challenges In P&S System Sub barriers of Payment & Settlement System: Lack of Real Time Gross Settlement (RTGS) Lack of Large Value Payment System (LVPS) Electronic Fund Transfer between Banks (EFT) Insufficient ABBS of branch network in Banking system. 17

18 Challenges In P&S System Sub Barriers of Payment & Settlement System: Lack of promotion in large scale use of the electronic modes of payment across the country. Absence of modern technology, customer service and fraud control. Insufficient customer education & awareness. 18

19 NEPAL RASTRA BANK (14 th S P C Meeting, DEC9,2012 ) Electronic Banking By Mobile Phone Next Revolution for Financial Access? Total Population Bank & FIs Number Percentage Percentage Per Branch Urban Rural Total

20 NEPAL RASTRA BANK (14 th I S P C Meeting, DEC.9,2012 ) Electronic Banking By Mobile Phone Next Revolution for Financial Access?. Branch expansion trend of Nepalese banking sector is satisfactory. The significant number of branch has been increased within the last five years. But most of them are concentrated on urban areas. Only 538 branches are established in rural areas, which is only 17.2% of total number of branches. 20

21 NEPAL RASTRA BANK (14 th S P C Meeting, DEC.9,2012 ) Electronic Banking By Mobile Phone Next Revolution for Financial Access? In this regard, the potential of e-banking to extend the reach of financial institutions significantly into rural areas, without investing much amount in branches which is very high. Existing branch delivery systems absorb more than half of the operating cost and define the organizational structure of the banks. 21

22 NEPAL RASTRA BANK (14 th S P C Meeting, DEC.9,2012 ) Electronic Banking By Mobile Phone Next Revolution for Financial Access? Emerging advances in information and communication technologies and their widespread usage offer tremendous opportunity to achieve this goal by making available non-traditional ways of providing financial services. Mobile banking represents a modern distribution channel that allows financial institutions and other commercial actors to offer financial services outside traditional bank premises. 22

23 NEPAL RASTRA BANK (14 th S P C Meeting, DEC.9,2012 ) Electronic Banking By Mobile Phone Next Revolution for Financial Access? Due to revolutionary change in telecommunication sector, the number of mobile phone users in Nepal has increased significantly. It opens new avenue for branchless or depersonalized banking. The mobile subscriber base has reached million. 23

24 NEPAL RASTRA BANK (14 th S P C Meeting, DEC.9,2012 ) Electronic Banking By Mobile Phone Next Revolution for Financial Access? Nepalese banking sector and technology partners are also making their effort to search business opportunities for mobile banking and branchless banking. NRB has recently issues separate directives to govern and promote e-banking. 24

25 NEPAL RASTRA BANK (14 th S P C Meeting, DEC.9,2012 ) Electronic Banking By Mobile Phone Next Revolution for Financial Access? Despite of various emerging risk and challenges associated in e-banking transaction, no one have better solution to accept it. E-banking facilitates every individual and business industry by providing various services. It is also equally important to the low income group as well. The direct advantages of e-banking to the micro finance customers are in following ways.. 25

26 NEPAL RASTRA BANK (14 th S P C Meeting, DEC.9,2012 ) Electronic Banking By Mobile Phone Next Revolution for Financial Access? Accessibility :- Convenience :- Security :- Cost & Time Saving :- Utilities for Payments/ Insurance Companies :- 26

27 NEPAL RASTRA BANK (14 th S P C Meeting, DEC.9,2013 ) Electronic Banking By Mobile Phone Next Revolution for Financial Access? There is no doubt, the use of technology and innovating e-banking products will definitely provide solution to enhance financial access in rural areas. The primary factor to make successful implementation of e-banking is customer awareness. So related beneficiaries need to focus their effort in this area.. 27

28 NEPAL RASTRA BANK (14 th S P C Meeting, DEC.9,2012 ) Electronic Banking By Mobile Phone Next Revolution for Financial Access? From the part of policy maker, we should be committed to optimizing financial inclusion whilst maintain the integrity of the financial system, securing depositors saving and suppressing money laundering. This is a balancing act that will continue the challenge to all the regulators worldwide.. 28

29 NEPAL RASTRA BANK (14 th S P C Meeting, DEC.9,2012 ) Electronic Banking By Mobile Phone Next Revolution for Financial Access? However, even with the most enabling regulatory environments, e-banking solution providers are only going to be successful in the short term if they concentrate on areas where cash is convenient and e-banking solution can do things that cash can not. 29

30 NEPAL RASTRA BANK (14 th S P C Meeting, DEC.9,2012 ) Electronic Banking By Mobile Phone Next Revolution for Financial Access? To do this effectively, we need to spend more time on understanding the market and building the value proposition in business case. The technology is already available to serve us better, just we need to utilize it in proper way safely. 30

31 Submitted to : SPC, Kovalam, INDIA Thank you very much to all. To be familiar with Nepalese banking system. 31