Rising Trust in Long-Term Deposits: Nepal’s Commercial Banks Show Strong Savings and Fixed Deposit Growth

As of Jestha end 2082 (mid-June 2025), the deposit position of major commercial banks and financial institutions in Nepal reflects a healthy distribution across various types of deposit instruments, with total deposit volumes varying significantly among banks. The largest deposit holder was Global IME Bank, with a total deposit volume of NPR 5.54 trillion, followed by NABIL Bank (NPR 5.13 trillion), Rastriya Banijya Bank (NPR 4.73 trillion), and NMB Bank (NPR 2.75 trillion).

Among deposit types, savings and fixed deposits dominate the banking landscape. For instance, NABIL Bank held NPR 1.85 trillion in savings and NPR 2.36 trillion in fixed deposits. Similarly, RBB recorded NPR 2.28 trillion in savings and NPR 1.75 trillion in fixed deposits. The continued preference for fixed deposits—despite lower liquidity compared to savings—reflects savers' pursuit of higher returns amid steady interest rates.

Current deposits, which provide high liquidity, remain lower in volume relative to savings and fixed deposits, ranging from NPR 7.9 billion in Citizen Bank to NPR 44.2 billion in NABIL. This indicates a conservative shift in banking customers preferring interest-bearing instruments. Most of these deposits are domestic, with only a small fraction sourced from foreign currency accounts. For example, NABIL Bank's current foreign deposits stand at NPR 5.95 billion.

Call deposits, typically used by institutions or high-net-worth clients for short-term flexibility, are relatively significant in larger banks like NABIL (NPR 44.1 billion), NMB (NPR 23.2 billion), and Global IME Bank (NPR 37.2 billion). These short-term instruments reflect institutional liquidity parked temporarily with banks.

Interestingly, other deposits—which may include institutional escrows or special-purpose reserves—are also notable in banks like NABIL (NPR 3.97 billion), NMB (NPR 3.05 billion), and Sanima (NPR 1.72 billion). These funds provide flexibility to banks in managing short-term liquidity requirements.

From a macroeconomic lens, the dominance of domestic deposits across all types underscores a relatively stable remittance inflow, but a limited diversification of the deposit base beyond national borders. Foreign deposits across most banks remained under NPR 1 billion, except for select banks like HBL (NPR 1.2 billion) and NMB (NPR 247 million), suggesting scope for banks to tap into more non-resident Nepali (NRN) depositors.

In conclusion, the banking sector's deposit structure showcases sound diversification with a healthy share of stable long-term deposits. The data also hint at an opportunity for policy-makers and banks to encourage more foreign currency inflows and broaden international deposit participation. The sustained strength in savings and fixed deposits signals consumer confidence and a maturing financial ecosystem.