Savings Deposits Rise Slightly as Residential Accounts Dominate Financial Institution Holdings

Nepal’s financial institutions have reported a modest increase in savings deposits, highlighting continued household confidence in the banking system despite declining demand and fixed deposits. According to the Nepal Rastra Bank’s Other Depository Corporation Survey (Mid-August 2025), total savings deposits rose by Rs. 32.3 billion (1.2%)compared to the previous month, reaching Rs. 2.70 trillion.

The data reveals that residential (individual) depositors continue to dominate the structure, accounting for over 98% of total savings deposits, equivalent to Rs. 2.67 trillion, while non-residential deposits stood at Rs. 29.2 billion. The steady growth among residential accounts reflects strong household saving behavior amid a stable interest rate environment and a gradual return of remittance inflows.

Analysts note that as deposit rates on fixed accounts have declined, many individuals have shifted towards flexible savings and call accounts. This shift indicates a preference for liquidity and easy access to funds rather than locking money in long-term deposits, especially during uncertain market conditions.

Meanwhile, commercial banks remain the primary holders of savings deposits, representing more than three-fourths of total institutional deposits. Development banks and finance companies have maintained relatively smaller but stable shares.

Despite the marginal rise, the overall deposit base across the banking sector fell due to significant declines in demand and fixed deposits, suggesting a cautious financial sentiment among both corporate and individual clients.