A COVID Perspective on Nepal Microfinance

Advisory Note on the liquidity of MFIs in Nepal

This analysis of the microfinance scenario in Nepal is the third in the series of M-CRIL Advisory Notes on liquidity in microfinance sectors in Asia. It follows a detailed analysis of liquidity in Indian and Myanmar microfinance. It shows a less troubled situation than in India but points to potential issues resulting from the microfinance demand of Nepali migrant workers returning from other countries. 

These findings provide a guide for the managements of micro-lending institutions, for wholesale lenders and investors to understand the liquidity challenges of the lockdown. The analysis here is based largely on the July 2019 balance sheets of the MFIs in the sample.

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By Sanjay Sinha , Nara Hari Dhakal