KATHMANDU: Nepal Rastra Bank (NRB) reports that around 180,000 Nepalis are currently blacklisted, with 70 percent of cases linked to check bounces and the remaining due to non-payment of loans.
Guru Prasad Poudel, head of NRB’s Bank and Financial Institutions Regulatory Department, said more than 70,000 individuals have been blacklisted for issuing checks without sufficient funds in their accounts.
A check bounce occurs when a check is issued but cannot be cashed due to insufficient funds, leading to the issuer’s imprisonment and blacklisting by NRB. This status prevents them from accessing future bank loans.
Former Chief Justice Kalyan Shrestha has criticized the criminalization of check bounce cases, describing it as an excessive use of force by banks.
He argues that blacklisting and jailing individuals does not recover funds, improve payment capacity, or foster honesty. Instead, it hinders their ability to return to business and repay debts.
Shrestha questioned the rationale behind criminalizing check bounces, stating that treating them as economic crimes may not be justified. He stressed the need for a more balanced approach, asking why the state views check dishonor with such gravity while ordinary unpaid transactions are resolved differently.
In response, Poudel acknowledged the complexities of the issue during an interaction on banking challenges, jointly organized by Khabarhub.com and the Institute for Strategic and Socio-Economic Research (ISSR).
He revealed that NRB is reviewing its approach to check dishonor cases, seeking feedback and exploring alternative measures.
Poudel admitted that both blacklisting and leniency have their own sets of challenges, necessitating a balanced resolution.
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