Call Deposits Surge to Rs. 566 Billion, Reflecting Improved Short-Term Liquidity in Financial

Nepal’s financial institutions have witnessed a notable improvement in short-term liquidity as call deposits jumped to Rs. 566.4 billion by mid-August 2025, up from Rs. 520.7 billion in the previous month — an 8.8 percent rise, according to Nepal Rastra Bank’s Other Depository Corporation Survey. This sharp increase indicates greater flexibility in short-term funds and heightened interbank activity amid stable interest rates.

The data shows that residential call deposits, mainly from individuals and small enterprises, surged by 9.1 percent to Rs. 557.8 billion, while non-residential deposits, which include institutional and corporate holdings, fell by 9.7 percent. Analysts attribute this divergence to a liquidity preference among households and SMEs seeking quick access to funds as loan demand slows.

The rise in call deposits also underscores the ongoing liquidity management efforts of commercial banks, which are balancing lending growth with reserve requirements. It reflects cautious optimism in the financial system — institutions are holding higher liquid assets to mitigate funding risks while awaiting clearer signals from the monetary policy stance for FY 2025/26.

Overall, the surge in call deposits points to an improved liquidity position in Nepal’s banking system, but it also highlights limited long-term deposit confidence, as savers still favor short-term instruments.