Lack of banking institutions create challenges at local levels of Province 7

DHANGADHI: Majority of local levels in Province 7 are still deprived of banking services at a time when the country has adopted federalism with a promise of decentralisation.

Out of the total 88 local levels in the province, only 32 have access to banking services, while 56 local levels still lack this facility.

Due to the absence of banks at local levels, not just government bodies but local people have also been facing impediment to carry out their financial transactions. The local levels have to depend on banks located at the district headquarters to carry out financial activities such as depositing tax amounts, distribution of social security allowances, payments related to development activities, and payment of salaries to its employees among others.

Likewise, the general public also have to travel to the district headquarters to carry out any kind of financial transactions.

The banks have indicated that lack of basic infrastructure required for operating a bank is the main reason behind them not being able to reach the local levels.

Deputy Director of Nepal Rastra Bank (NRB), Dhangadhi branch, Dirgha Rawal said, less number of service seekers, lack of security management and basic infrastructures like roads, buildings to house the bank, electricity, telephone, internet among others make it a challenge to open bank branches in rural areas and which limit the banking operations to urban and accessible areas.

According to the statistics of NRB Dhangadhi, there are 300 branches of various banks in the nine districts of the province. However, out of the 300 branches, 202 branches are centred only in Kailali and Kanchanpur districts.

Rawal added that it is important the government pays attention towards infrastructure development at local levels to attract banks for expanding their services to the rural areas.

However, NRB also indicated that some banks are seen uninterested in going to the local levels despite the availability of basic infrastructure required for their operations.