It is very much possible that most of us reading this piece of write-up have directly suffered from the fall of
Nepal Bangladesh Bank (NBB) which led to Nepal Rastra Bank taking over the management. Even after
standing in long queues, the fear of non-payment and threat of one's money going in vain must had taken
away the sleep of many depositors at NBB.
Headline
Headlines like "Court order on NBB"and "NB Bank gives in to central bank"panicked its depositors and
customers so much so that they got lined up to withdraw their hard earned money as early as 5 a.m. If we
are to rely on media sources, the total cash withdrawal on 9th and 10th November alone totaled to Rs.1.87
billion. The panic, therefore, was no surprise. We could see first hand thousands of depositors thronging
NBB branches all over the country once the reports of misuse of funds by NBB board and management got
media coverage.
As a layman, it is high time that we found reasons of why banks have so many different features and
different schemes to attract and to retain their depositors and not be lured by what they have to say. There
are banks offering interest rates as high as 5 per cent and as low as 1.5 per cent per annum to savings
account depositors. There are banks that offer schemes carrying special features for special savings
account and there are banks with varying minimum balance requirements. We can see banks going for
advertisements in media like never before. It is in the end, however, the depositors' choice that matters
most and that is what is of vital importance.
With NBB's failure, there are many lessons that need to be learnt by depositors. Depositors should no more
be disillusioned by high interest rates, attractive schemes and numerous other services promised to be
rendered by Banks. Depositors have already paid high costs for their mistake of choosing the wrong bank
to put in their money in NBB. If depositors are to think wisely and learn lessons from such failures, it would
not be long before banks are forced to either maintain their financial etiquette or move out of the industry all
together.
There are many factors that led to the downfall of NBB. To name a few, it was a handful of people who
misused or wrongly used their authority and power, weak central bank and government policy coupled with
the ignorance of the depositors.
It is time for the depositors to reason out the amount required for minimum balance and payment of high
interest rates. The interest rate especially is mostly to do with the reliability, quality of services,
trustworthiness of the Management and the background of the promoters. Common customers therefore
should build a habit of having basic information about the organization they are likely to build relationship
with. In other words, the fundamentals of the financial institution have to be right. The owners, the
management, the historical background and the financial health are some very basic aspects one has to
look into before building a relationship with any organization, and especially banks.
The financial sector is the backbone of any nation's economy and should there be a loss of trust on banks
and other financial institutions in the country, it would not take much time for the country to witness a
systemic crises where the entire payment system gets affected leading to an economic downturn. It is
therefore necessary that depositors keep their eyes and ears open to every activity of banks and decide
with which bank they would want to build a relationship with to enable the economic development of the
country and to enjoy the modern, efficient and doubt-free financial services. Banking with a certain Bank
should be the matter of pride for the customers rather than being a regret. The customers should closely
monitor the performance of banks. They should conduct timely study to find out which banks are ailing and
which ones are maintaining their consistency as trustworthy institutions.
Power
Therefore, as responsible customers who have saved some money despite the ever rising expenses, we all
should be conscious enough before we choose our bank; this could well be as important as buying a
property- the research has to be deep. At the same time, we should be taking some responsibility for sick
practices pertaining to our financial sector and try to rid of them all. We are the ones who have the power
chase people with dubious intentions out of our economy.

Published in The Rising Nepal. Very Informational
http://www.gorkhapatra.org.np/content.php?nid=7158