For more than a decade, branchless banking was Nepal's answer to a simple problem: banks are expensive to build in remote hills and villages, but people there still need somewhere to deposit, withdraw, and send money. Local shopkeepers and cooperatives became bank agents, handling cash transactions on a bank's behalf without ever needing a branch. That network is now shrinking fast. According to Nepal Rastra Bank's own supervision data, the number of branchless banking centres fell by roughly a quarter in a single year. Here is what the numbers show, why it is happening, and what it means for the people who relied on these centres the most.
Quick Answer
Nepal Rastra Bank's Bank Supervision Report for FY 2024/25 shows branchless banking centres falling from 1,112 to 816, and branchless banking customers falling from 301,589 to 277,680, in the year to mid-July 2025. Over the same period, mobile banking users grew from 21.14 million to 23.79 million and internet banking users grew from 1.33 million to 1.60 million. NRB's own report links the decline directly to deepening mobile phone penetration, which is making agent-based cash counters less necessary for many customers.
What Branchless Banking Actually Means in Nepal
Branchless banking is an agent-based delivery model: a bank appoints a local shopkeeper, cooperative, or small business as its agent, equips them with a point-of-sale device or mobile-linked system, and allows them to accept deposits, process withdrawals, handle balance enquiries, and facilitate fund transfers on the bank's behalf. It was designed specifically for areas where opening a full bank branch was not commercially viable, letting people in remote hill and Tarai districts access basic banking without traveling hours to the nearest town.
The Numbers Behind the Decline
NRB's annual Bank Supervision Report, covering fiscal year 2024/25 and released in June 2026, documents the shift in stark terms. While nearly every digital banking channel expanded, the agent-based branchless channel contracted for the second year in a row.
| Channel | Mid-July 2024 | Mid-July 2025 | Change |
|---|---|---|---|
| Branchless banking centres | 1,112 | 816 | Down about 27% |
| Branchless banking customers | 301,589 | 277,680 | Down about 8% |
| Mobile banking users | 21.14 million | 23.79 million | Up about 13% |
| Internet banking users | 1.33 million | 1.60 million | Up about 20% |
| Total ATMs | 4,801 | 4,878 | Up slightly |
| Debit card holders | 11.76 million | 12.37 million | Up about 5% |
| Prepaid card holders | 178,216 | 245,992 | Up about 38% |
Why the Decline Is Happening
1. Mobile phones are doing what agents used to do
NRB's own report links the trend directly to rising mobile penetration, noting that agent-based delivery channels are losing relevance as more people gain access to smartphones and bank-linked mobile apps. A villager who once had to visit the branchless banking counter to deposit remittance money or check a balance can often now do the same thing from a phone, at any hour, without paying an agent commission or waiting for the shop to open.
2. Bank branch expansion has closed some of the original gap
Regulatory requirements that pushed commercial banks to open physical branches outside the Kathmandu Valley, alongside microfinance and cooperative expansion into rural areas over the past decade, mean that some communities that once depended entirely on a branchless agent now have a real bank branch or a wider network of ATMs nearby.
3. Agent economics have not kept pace
Running a branchless banking counter requires an agent, usually a small shopkeeper or cooperative, to hold cash floats and handle transaction risk for a modest commission. As transaction volumes shift to free or low-cost digital channels, the commission-based agent model becomes less attractive to run, and some agents simply let their agreements lapse rather than renew them.
4. Digital wallets and QR payments have absorbed everyday small transactions
Bank-linked mobile apps and QR-based wallets have expanded rapidly across Nepal for small, everyday payments and transfers, a category of transaction that branchless banking agents used to help process. As these tools became easier to use, much of the routine, low-value transaction volume that once passed through a branchless counter moved onto a smartphone screen instead.
Related development: NRB shut down a digital-only bank pilot in 2025
Even as agent-based branchless banking shrinks, Nepal Rastra Bank has been cautious about the digital-native alternative. In 2025, NRB ordered Laxmi Sunrise Bank to shut down its digital-only banking service, run in partnership with a fintech company, despite the government's budget and NRB's own monetary policy pledging to expand branchless banking and support neo-banks for rural financial inclusion. The episode illustrates a tension in Nepal's financial-inclusion strategy: policy documents promise faster digital expansion, while the regulator continues to move cautiously on new digital banking models.
What This Means for Rural and Underserved Communities
Faster access for smartphone owners
Anyone with a smartphone, a registered SIM, and a linked bank account generally gains faster, 24/7 access to their money than a branchless counter with fixed shop hours ever offered.
A widening gap for the digitally excluded
Elderly customers, people without smartphones, and areas with poor mobile network coverage risk losing their nearest cash-handling option as branchless centres close, without a digital substitute that actually works for them.
Cash-in, cash-out remains a real need
Digital balances still need to become physical cash eventually for many rural households. As branchless agents thin out, that conversion step can mean a longer trip to the nearest ATM or bank branch.
Remittance-dependent households are affected most
Branchless banking counters have historically been an important pickup point for domestic remittances in migration-heavy districts; their decline shifts more of that traffic toward mobile banking apps, which assumes the receiving household already has one set up correctly.
Frequently Asked Questions
Is branchless banking disappearing completely in Nepal?
Not entirely, but the network is shrinking steadily. NRB data shows a drop from 1,112 to 816 centres in a single year, and the trend has continued for more than one reporting cycle, even as the government's own policy documents continue to reference expanding branchless banking as a financial-inclusion tool.
What is replacing branchless banking centres?
Mobile banking apps run directly by commercial banks, along with QR-based digital wallets, are absorbing much of the transaction volume that branchless agents used to handle, according to NRB's own supervision report.
Does this affect people without smartphones?
Potentially, yes. As agent counters close, people who are not comfortable with or do not have access to a smartphone and reliable mobile network may need to travel further to a bank branch or ATM for basic cash transactions that a nearby branchless agent used to provide.
Are ATMs replacing branchless banking centres?
ATM numbers grew only modestly over the same period (from 4,801 to 4,878), so ATM expansion alone does not fully explain the drop in branchless centres. Mobile and internet banking growth appears to be the larger factor, per NRB's report.
Where can I find the official data behind these figures?
These figures come from Nepal Rastra Bank's Bank Supervision Report for fiscal year 2024/25, published on NRB's official website, and NRB's monthly Banking and Financial Statistics releases, which track branchless banking centres and customers alongside other access channels.
Figures can change
The statistics in this article reflect NRB's Bank Supervision Report for FY 2024/25 (data as of mid-July 2025, report released June 2026). NRB publishes updated banking and financial statistics regularly; check NRB's official website for the latest figures before citing them elsewhere.
Related Reading
If you rely on ATMs more than branchless counters these days, see our guides on Nepal's 2026 ATM withdrawal limits and inter-bank ATM charges in Nepal to understand what you can withdraw and what it costs. If you are in an area where cash access is becoming harder to find, our safety guide on how to spot an ATM skimming device in Nepal is worth a read before your next withdrawal.
Discussion