The World Bank has approved a US$95 million operation to help expand access to finance for more than 100,000 small and medium enterprises in Nepal, supporting job-led growth and strengthening financial inclusion. Approved by the World Bank’s Board of Executive Directors, the financing aims to address key barriers faced by underserved businesses while promoting private sector–driven economic development.
A central focus of the operation is strengthening Nepal’s Deposit and Credit Guarantee Fund to expand risk-sharing mechanisms, improve financial sustainability, and introduce new guarantee products tailored to underserved segments, including women-led businesses. By reducing lending risks and transaction barriers, the project is expected to improve access to credit for micro, small, and medium enterprises and support their integration into regional and global value chains.
The Sustainable and Inclusive Finance Project builds on reforms supported under the World Bank-financed Financial Sector Stability and Finance for Growth Development Policy Credit series, which concluded in 2024. These reforms prioritized access to finance for underserved segments as a key pillar of Nepal’s financial sector development agenda.
In parallel, the project will invest in strengthening the technology and institutional capacity of the Credit Information Bureau of Nepal. Planned interventions include expanding data coverage, integrating alternative data sources, and enhancing data security and privacy to improve credit information systems and support more informed lending decisions.
The project aligns closely with the Government of Nepal’s second Financial Sector Development Strategy and complements ongoing support from the International Finance Corporation. Together, these efforts aim to create a more inclusive, resilient, and efficient financial system that supports sustainable economic growth, job creation, and broader financial access across Nepal.
