Kathmandu. Nepal Rastra Bank has introduced the concept of digital bank and digital currency. The National Bank aims to replace the traditional banking system with digital means with the aim of improving transparency and organizing the informal economy of Nepal.

Rastra Bank is of the opinion that the concept of digital bank should be advanced to introduce new technology in the banking sector, increase competition and encourage innovation. As the discussion of digital bank and currency continues in Nepal, it has become a matter of interest what kind of digital bank it will be. Banks are now physically operating in Nepal. Customers still have to be physically present to avail banking services. On the other hand, a large amount of money is being spent on printing and shipping notes from Nepal. In this case, even if the concept of Central Bank digital currency, which is being developed at the international level, is implemented, it is said that it will take time to replace the traditional banking system.

Although digital transactions and payments are increasing in Nepal, the situation of financial literacy among most consumers, especially in rural areas, is worrying. Even among some educated people, there seems to be a lack of sufficient knowledge on financial risks, tax management, and credit utilization. Most of the citizens are deprived from opening bank accounts, requesting loans and enjoying the facilities and tax exemption schemes provided by the bank. Nepal Rastra Bank has started 'Digital Financial Literacy Campaign' since January 2079 with the aim of making citizens aware of digital transactions. As the security related risks are increasing in digital transactions, consumers are requested to be cautious while doing business.

According to the data of Nepal Rastra Bank, till the end of February of the current financial year, transactions worth 2 trillion 91 billion 95 million rupees have been done through mobile banking. Similarly, 4 trillion 83 billion 182 million rupees were transacted from Connect IPS, 42 billion 56 million rupees from QR payment, 5 billion 189 million rupees from POS and 606 million rupees from e-commerce. During this period, the number of mobile banking users has reached 237,830,000.