Financial Service in Nepal.

The use of institutional financial services has been slow to spread in rural areas. Until the mid-1990s, most Nepalese banks were state controlled or owned. The country's first commercial bank, Nepal Bank Ltd., opened in 1937. The central bank, Nepal Rastra Bank, opened in 1956, and Rastriya Banijya Bank opened in 1966. Specialized financial institutions such as the Nepal Industrial Development Corporation (NIDC) and the Agricultural Development Bank (ADB) were also established to provide assistance to private industry and small farmers, respectively. These have had mixed success since traditional moneylenders still play a central role in village financial affairs. By 1990 the ADB had only granted loans to 9 percent of all farming families. Since 1984, foreign banks have been allowed to operate in Nepal as part of a strategy to encourage foreign investment. By the beginning of the 21st century, there were 14 commercial banks and 45 finance companies in Nepal.