UNDP provides Rs. 238 m project to increase financial services access

The United Nation’s Development Fund (UNDP) has provided Rs. 238 million ($ 3 million) project to Nepal to increase the use of formal financial services in remote areas of the country.

The government of Nepal, UNDP and the United Nations Capital Development Fund (UNCDF) signed the project entitled 'Enhancing Access to Financial Services’ to this effect.

Joint secretary at the Ministry of Finance Krishna Gyanwali,  Nepal Rastra Bank  Executive Director of  Micro-finance Department Gopal Kaphle and Anne-Isabelle Degryse-Blateau, UNDP Country Director singed the project.

According to a press release issued by the UNDP, the project will be implemented by the Nepal Rastra Bank (NRB). 

The project aims to increase access to financial services to additional 330,000 clients especially living in remote areas. Under this project, Financial Service Providers/Micro Finance Institutions will open up service delivery units in at least 10 remote districts and link at least 10,000 savings and credit groups promoted by UNDP, GOs and NGOs.

“The new project seeks to increase the use of formal financial services (credit, savings and micro-insurance) from profitable financial institutions (Banks, Microfinance Institutions) by urban micro, small and medium enterprises and urban and rural low income households," stated the press release.

This is the first project formulated by UNDP and UNCDF in collaboration with the Nepal Rastra Bank. The project will promote coordination amongst interested donors, in particular the World Bank, in line with the Paris Declaration on Aid Effectiveness and seek to pool the support coming in micro-finance sector into one basket thereby reducing the transaction cost on aid management.