Financial Sector Under Siege: Escalating Violence Against Bank Employees in Nepal

Nepal’s banking and financial sector is currently grappling with a dangerous surge in physical violence, harassment, and organized hostility directed at its employees. What began as isolated incidents has evolved into a systematic pattern of “debt-defaulter vigilantism,” creating an atmosphere of terror for frontline bank workers tasked with loan recovery.

The crisis reached a boiling point in late 2025 and early 2026 with a series of harrowing attacks. On December 10, 2025 (Mansir 25), staff from Jyoti Bikash Bank in Saptari were physically assaulted, smeared with black soot, and forced to wear garlands of shoes—a traditional form of public humiliation—while visiting a debtor.

This trend continued into early January 2026. In Ghorahi, the Branch Manager and a staff member of Nepal Investment Mega Bank (NIMB) were attacked by a debtor, Umakanta Bhandari, after they visited his home to discuss legal risks associated with his non-payment. More disturbingly, an incident in late 2024 saw two NIC Asia Bank employees narrowly escape being set on fire after petrol was splashed on them.

The escalation of this anarchy is largely attributed to organized campaigns led by controversial figures. In early 2023 (Falgun 2079), medical entrepreneur Durga Prasai launched a nationwide campaign calling on debtors to refuse loan repayments and physically humiliate bank staff who came to collect.

Economists and industry leaders warn that if the state fails to uphold the rule of law, the entire financial system could collapse. Dr. Chandramani Adhikari, an economist, criticized the government for negotiating with groups inciting violence rather than prosecuting them. “Politics and the state have failed to function effectively,” he noted, urging debtors to seek legal recourse instead of resorting to violence.

Rajesh Sharma, Information Officer at NIMB, emphasized that bank staff are simply fulfilling their duty to prevent Non-Performing Loans (NPLs) from rising. Nepal’s NPL ratio has recently spiked from 1% to nearly 5%. “If loans aren’t recovered, the banking sector cannot survive. This isn’t just about bank owners; it’s about the deposits of the general public,” Sharma stated.

The Nepal Rastra Bank (NRB) has expressed grave concern. NRB Spokesperson Guru Prasad Poudel confirmed that the Governor is in constant communication with the Home Ministry and security agencies to ensure the safety of financial workers. The current conflict presents a lose-lose scenario. For the economy to recover, a stable environment for both lenders and borrowers is essential—a goal that remains out of reach as long as bank employees fear for their lives.