How COVID-19 is Reshaping Nepal’s Banking Culture

June 15, 2021

By John Narayan Parajuli

KATHMANDU, Nepal – The scenes from Nepal, where I live, are heart-breaking. With the pandemic raging on, there are severe shortages of hospital beds, ventilators, and oxygen across the country. Total active cases jumped from 1,500 two months ago to nearly 150,000 at the end of May—closely mirroring the situation in India. I can’t think of a time in recent memory that my country has ever felt this helpless—not even in the aftermath of the deadly 2015 earthquake, which traumatized people across the nation for years.

The COVID-19 pandemic has been deadly for the people of Nepal. It has affected more than 10,000 health-care professionals and more than 9,000 security forces, all of whom continue to work long shifts. But what came as a shock to me was hearing about the vulnerability of a third group: bank employees. It’s been particularly unsettling for me because I have several friends in the industry.

Nepal’s banking sector employs nearly 50,000 people. In the first wave of the pandemic, which lasted until the end of March 2021, 8,000 bank staff were infected with coronavirus. The second, ongoing wave could prove to be much worse, as banking officials told me. COVID-19 numbers have multiplied within a few weeks: by the end of May, 4,548 people who work at banks were infected, according to the Nepal Bankers' Association (NBA).

Several friends and acquaintances—and in some cases, their entire families—have contracted the virus. I spoke to them, and to industry leaders across Nepal, about how the pandemic might reshape the sector and its employees’ jobs in the years to come.

Minimizing risk

My friend Ashbin Kumar Pudasaini, the head of training and development at Nepal Bank Limited, is one of many bank employees who fell ill with COVID-19.

Pudasaini had been behind the wheel of his car last fall when he suddenly began gasping for air. Once he arrived at the office, his bank colleagues helped him get tested. When he was diagnosed with COVID-19 a few hours later, the bank arranged isolation in a hotel room for him. He stayed there for the next 15 days until he tested negative.

Ashbin Kumar Pudasaini contracted COVID-19 in the first wave of the pandemic.
Ashbin Kumar Pudasaini contracted COVID-19 in the first wave of the pandemic. Photo by: Laxmi Prasad Ngakhusi

"I felt really lonely at times," said Pudasaini, a father of two. "Even though I spoke to my family, friends and colleagues regularly, I struggled to maintain a positive outlook."

Though many other bank employees I spoke to didn't want to publicly share their stories—for fear of putting a negative spotlight on their banks--data compiled by NBA reveals how widespread infections are. The numbers show that 7,929 bank staff and 2,969 of their immediate family members were affected in the first wave of COVID-19. Nepal Bank Limited alone had over 400 infected staff in 205 branches across the country.

"The infection rate is even more alarming in the second wave," Anil Sharma, CEO of NBA, told me.

Banks are taking measures to minimize employees’ risk. For example, Nepal Rastra Bank, the central bank of Nepal, has directed its branch offices to operate with 25 percent staff or less, and has allowed banks to have the rest of the staff work from home. But it has also instructed banks to keep their front offices open for any walk-in banking needs.

Banks have taken several standard precautions to protect staff from infections, including providing personal protective equipment in addition to the standard protocols. Several banks have taken ad-hoc measures, such has paying for staff members’ hotel rooms, arranging polymerase chain reaction (PCR) tests, and providing COVID-19 insurance coverage.

The government prioritized bank staff for vaccinations. By early April, these employees were eligible for two doses of COVID-19 vaccines. But vaccine hesitancy and relatively milder cases in the first wave made many complacent about the virus’ risks. Despite having access to the vaccines, the vaccination rate among staff at bank institutions is low—and even lower among bank employees outside the capital.

The second wave ushered in another set of difficulties, according to Rashmi Pant, Chief Operating Officer of Prabhu Bank.

Rashmi Pant, Chief Operating Officer of Prabhu Bank.
Rashmi Pant, Chief Operating Officer of Prabhu Bank. Photo courtesy: Rashmi Pant

"In the first wave, the problem was mostly logistical, such as rotating staff and arranging commutes for them to keep the banks in operation,” said Pant. “Now, the challenge is dealing with mental stress and fatigue among staff. I spend a good amount of my time counseling them."

Pushing toward digitization

Digital banking services are one way around the risk of exposure faced by bank employees. Aside from a recent trip to get a new debit card, my own banking experience has been largely virtual during the past year.

Nim Sherpa, a young staff member at my local bank, has been my point of contact for handling my financial needs. Instead of driving up to my branch, I text or email him. He calls me back promptly to verify details and handles my requests swiftly. But despite operating in this way with many of his clients, Sherpa recently had to self-isolate for several days—because one of his colleagues tested positive for COVID-19. He later tested negative.

In recent years, Nepal has moved toward the digitization of financial services and has witnessed a rise in the adoption of financial technology (also known as fintech). Because of the pandemic, most banks have now adopted QR code-based touchless payment options, and some have even floated mobile loans.

A customer in Lalitpur, Nepal uses a mobile banking app to check her balance.
A customer in Lalitpur, Nepal uses a mobile banking app to check her balance. Photo by: Laxmi Prasad Ngakhusi

Still, cash remains king. The country has an adult population of about 20 million, but the number of ATM card holders is less than 9 million, and the number of mobile banking users is about 10 million, according to recent study by Nepal Rastra Bank. (These numbers distort the true extent of the penetration of mobile banking because most customers have accounts in multiple banks.)

There is considerable scope for expanding the adoption of fintech services both in urban and rural areas. And even though the digital divide, some transaction caps, the literacy rate, and trust issues related to digital services continue to create impediments, confidence in the integrity of virtual banking is growing.

Anupama Khunjeli, CEO of Mega Bank, believes that the pandemic is one factor—and that it is reshaping Nepal’s banking culture.

Anupama Khunjeli, CEO of Mega Bank
Anupama Khunjeli, CEO of Mega Bank. Photo by: Anish Regmi

“COVID-19 has brought about a change in the way the banking sector operates,” she said on IFC’s radio broadcast. “From opening accounts online to other needs, the pandemic has revealed the need to change our existing processes.”

Ratna Raj Bajracharya, CEO of Global IME Bank, also thinks that COVID-19 has opened up possibilities for a new way of doing business. "In the next several months, thousands of customers could be switching to digital banking because of the work banks have done collectively," Bajracharya told me. "Once customers get accustomed to the ease of digital banking, there is no going back."

Perhaps this will be one positive development to come out of this horrible period. The challenge will be to make these digital services available to the sizable populations in Nepal’s rural areas. But what’s important now, and for likely months to come, is that the people of Nepal, including those working in banks, protect themselves from this deadly virus.

John Narayan Parajuli is an IFC communications officer based in Kathmandu. His email is

Published in June 2021