Over 6 Crore Deposit Accounts in Nepal: Financial Inclusion or Fragmented Banking?

By Saun End, 2082 (Mid-August 2025), Nepal’s financial system has recorded an extraordinary milestone with over 6.01 crore deposit accounts across Class A, B, and C institutions. Commercial banks (Class “A”) alone manage 5.16 crore accounts, followed by development banks (Class “B”) with 75.4 lakh, and finance companies (Class “C”) with about 10 lakh accounts. At face value, this expansion signals remarkable progress in financial inclusion, yet it also raises questions about whether this surge reflects genuine inclusion or an increasingly fragmented banking landscape.

From the inclusion perspective, the figures are encouraging. With Nepal’s population around 3 crore, the number of deposit accounts is more than double the population, reflecting both accessibility and deeper financial penetration. Branch expansion has supported this growth, with 6,526 branches nationwide and rapid adoption of technology. Digital channels have amplified this access, as 27.9 million mobile banking users and 2.25 million internet banking users now actively participate in the financial system. This shows how the banking sector is pulling rural households, migrant families, and small businesses into the formal economy, reducing reliance on cash-based transactions.

However, beneath the headline numbers, fragmentation is visible. Many individuals hold multiple accounts across different banks and institutions, often to take advantage of offers, diversify risks, or manage remittance inflows. This inflates the total account figures and may overstate true financial inclusion. For smaller institutions like finance companies, the relatively low number of accounts compared to their loan exposure also hints at limited outreach and concentration risks.

Moreover, the sharp rise in accounts has not been matched by equivalent savings growth. With fixed deposits making up 48.14% of total deposits and savings deposits at 37.37%, many accounts remain low-balance or inactive. For banks, this adds to the operational cost of maintaining accounts without significantly boosting their resource base.

In short, Nepal’s achievement of crossing 6 crore deposit accounts is both a symbol of financial progress and a structural challenge. It reflects accessibility, digital adoption, and regulatory push for inclusion. Yet, unless account activity deepens and fragmentation reduces, the headline figure may not fully translate into sustainable financial empowerment.