Governor claims of maintaining fiscal stability despite COVID-19 and supply chain disruptions"

KATHMANDU, APRIL 5: The five-year term of Nepal Rastra Bank (NRB) Governor Maha Prasad Adhikari concludes this week.

Speaking at a press conference held at the bank's central office yesterday, Governor Adhikari stated that the central bank has been able to maintain economic stability by improving its monetary policy in response to challenges such as the COVID-19 pandemic, the Russia-Ukraine war, and the global supply chain disruptions.

He highlighted that policy reforms undertaken during his tenure helped ease pressure on the external sector and significantly contributed to the strengthening of the country’s financial stability.

Governor Adhikari reported that Nepal currently holds sufficient foreign exchange reserves to sustain imports for 14.4 months. He also noted that inflation has remained within target levels, thanks to timely revisions to monetary policy.

“To cushion the impact of the COVID-19 pandemic, the Rastra Bank implemented various concessional fiscal and monetary policies. A flexible approach was adopted to facilitate the flow of credit to banks and financial institutions during difficult times,” he added.

According to him, these flexible policies had a positive impact on business operations, investment promotion, and the overall economic recovery.

He further stated that regulation and supervision of banks and financial institutions have been strengthened to ensure financial stability, with risk mitigation measures effectively implemented.

Governor Adhikari noted that the adoption of digital financial services—such as mobile banking, QR code payments, internet banking, and digital wallets—has significantly increased over the past five years.

“Electronic payment transactions doubled in Fiscal Year 2023/24 compared to 2020/21, supporting the expansion of digital financial inclusion,” he said, adding that the central bank has prioritized cyber security alongside technological and policy reforms.

Additionally, the Governor mentioned that 116 policy provisions have been formulated and implemented to drive institutional reforms and enhance operational efficiency.

He emphasized that regulation and supervision methods have been aligned with international best practices to fortify the financial system. Special attention, he added, has been given to cyber security, with policies introduced to guide the banking system toward greater digitization.

On the occasion, Governor Adhikari also released a book detailing the major initiatives and accomplishments of NRB over the past five years.