Nepal’s NMB Bank exhibited a high level of ambition in its offering, covering so many product and service areas, that it was a clear choice for the Asia-Pacific Bank of the Year regional award.
The bank implemented services utilising artificial intelligence with the creation of its NMB Sapati small-ticket personal loans, providing automated loans to customers though the mobile app. This opened up the opportunity for automated micro, small and medium-sized enterprise (MSME) loans and auto loans, and provided a template for the development of other automated products.
With the arrival of its green loan product suite, NMB Bank became the first lender in Nepal to create a climate-focused range of services. Under the ‘Go Green’ slogan, the bank issued green loans at a discounted rate for individuals and businesses looking to own ‘green’ buildings. To ensure the long-term sustainability of these loans, the bank has signed a debt partnership agreement with the International Finance Corporation to provide credit to qualifying projects.
NMB was focused on offering support to its MSME customers through the worst impacts of the Covid-19 pandemic. Anticipating the impact that the pandemic would have on tourism and small exporters, the bank sought external funds to provide interest-free loans. Under Project Swarojgar, the bank focused on supporting the country’s south-eastern Province 2 region to create job opportunities and support for entrepreneurs to reduce the number of people leaving to seek employment elsewhere. NMB provided a week-long training programme for 50 entrepreneurs, and aims to expand the service to other parts of the country facing similar issues.
In a move to reduce the use of paper cash during the pandemic, the bank worked to introduce transport payments by card, enabling social distancing on public transport and encouraging the move towards a cashless society.
Sunil KC, CEO of NMB Bank, says: “We shall continue with our sustainable banking agenda and work as a bridge between the local players and international organisations to advocate climate change concerns, and thus enhance larger public interests and awareness. We shall continue to keep digitisation at the core of our agenda to enhance inclusiveness and create client value.
NMB Bank undertook a range of important steps which saw the bank secure the award for Bank of the Year in Nepal.
The bank acquired Kanchan Development Bank in August 2020, as it sought to expand its reach across the country. Based in the far-west province of Sudurpashchim, the region is renowned for its wide potential in hydropower, tourism and agriculture. This has strengthened NMB Bank’s domestic footprint and created future business opportunities.
In a first for Nepal, NMB Bank launched a local currency energy bond. The NRs1.5bn ($12.6m) bond has a tenure of 15 years and carries a yield rate of 4% per annum, which is much lower than the prevalent market rates. During Nepal’s national Covid-19 lockdown, the bank was able to achieve full subscription in four days.
As Nepal’s banking system moves towards digitisation, NMB Bank has implemented digital-only banking services for its customers. Among these is the NMB Sapati personal loan. Available to existing deposit and credit customers, the small-ticket personal loan uses artificial intelligence to conduct eligibility checks and the disbursement process, without any human intervention. This was followed by the development of an automated auto loan service.
NMB Bank supported micro, small and medium-sized enterprises through the worst impacts of the pandemic with the creation of a special fund. Established with an international non-governmental organisation called ‘One to Watch’, the fund provided loans of up to NRs2m. These loans were provided without landed collateral security, are interest-free for 18 months, and have the additional benefit of bundled non-financial services, such as financial planning and HR management.
Sunil KC, CEO at NMB Bank, says: “Other than the constraints posed by the Covid-19 pandemic, growing concerns about climate change and its adverse effect on business have forced the banking industry to focus more on a green, inclusive and sustainable business model. Our strategy has been focusing on investment in sustainable assets to contribute to a resilient economy.”