Why are banks in Nepal closing at 4 PM? A look into the changing banking landscape

KATHMANDU: For those who remember Nepal’s banking scene two decades ago, closing times looked very different. Before the early 2000s (B.S. 2060), Nepal’s banking sector was still in its early growth phase, with only a few government-owned and private banks in operation. At that time, bank branches typically closed by 2:30 PM.

By 2007/08 (B.S. 2064/65), however, banking began to expand rapidly. With new banks entering the market, competition intensified. To attract customers, banks extended working hours and introduced evening banking services. Branches that once closed at 2 PM stayed open until 4 PM, and some even offered counters open until 6 PM or 8 PM.

One striking example comes from about a decade ago: a man from Dhading urgently needed cash late in the evening. At around 7:30 PM, after most banks had long shut, he rushed to the then-Sunrise Bank branch in Gairidhara. To his relief, the counter was still open until 8 PM, allowing him to withdraw the needed funds. Many customers benefitted from these extended hours.

Today, however, the picture has changed again. Most banks now close at 4 PM, and evening banking services have nearly disappeared.

The Rise and Fall of Evening Banking

Himalayan Bank was the pioneer of evening banking in Nepal, launching 8 AM to 8 PM services from its New Road branch when it began operations. Inspired by this, many other banks followed suit, offering extended hours for over a decade.

Gradually, though, evening banking was reduced first to 6 PM, and now, in most cases, eliminated entirely.

A veteran observer of Nepal’s banking industry explains, “Banks have become older and more relaxed. Competition has slowed, and the market feels fixed. Earlier, every bank was aggressive, trying to expand and innovate. Now, that vibrancy has faded. To bring energy back, new licenses should be issued and competition revived.”

Declining Demand at Counters

Bankers say that even when evening counters were operational, transactions were low. One banker noted that evening counters often saw transactions fall to just 10% of daytime volume.

“The number of people physically visiting bank branches has decreased sharply,” he said. “Most transactions now take place digitally. In Kathmandu, some branches barely see walk-in customers. Yet, those branches are staffed with 20–25 employees sitting at counters.”

This shift reflects a broader trend in Nepal’s banking sector: the digital transformation.

The Digital Disruption

Ganesh Raj Awasthi, Deputy General Manager of Nabil Bank, says evening services declined because of the rise in digital transactions.

“Customers can now transact through digital platforms, NCHL, and clearing systems. There’s no longer a need to go to a branch in the evening to deposit or withdraw money. Even interbank transactions are done digitally. Cash transactions are shrinking,” Awasthi explained.

Before the COVID-19 pandemic, most banks still operated evening counters. But the lockdowns forced branches to close, while digital adoption skyrocketed.

“Earlier, customers rarely used digital services even though products existed. After COVID, digital transactions surged. This reduced costs for banks and made services available 24/7. Customers can now check portfolios or transact at any time,” Awasthi added.

According to him, about 50% of banking transactions in Nepal are now digital, while at Nabil Bank, that figure has reached 92%.

“Counter transactions have declined drastically,” he said. “Once customers experience seamless digital services, the need to physically visit a branch disappears. Positive service experiences digitally translate into overall customer satisfaction.”

Why Evening Banking No Longer Makes Sense

Subhash Jamarkattel, Deputy General Manager of Machhapuchchhre Bank, echoes the same sentiment: demand has fallen, so supply adjusted.

“Branches operate based on demand and supply. If customers don’t come in the evenings, it’s unnecessary to keep counters open. Digital tools like QR codes and ATMs cover most needs,” Jamarkattel explained.

He also highlighted cost concerns, “Running evening counters is expensive. Staffing, security, and operational costs don’t justify the minimal returns. Banks evaluate whether the return matches the cost. Since customers prefer digital, evening counters have been phased out.”

The Broader Impact of Digital Banking

Bankers also note a cultural shift brought by digitalization. With fewer people visiting branches, face-to-face customer interactions are dwindling.

“Digital innovations encourage efficiency and push employees to adapt. But like how social media reduced family interactions, digital banking reduces human interactions between customers and bank staff,” Jamarkattel reflected.

Still, most agree that convenience outweighs nostalgia. Customers prefer the ability to transact anytime, anywhere over waiting in queues at physical counters.

The Bottom Line

The era of banks staying open till 8 PM to serve walk-in customers is largely over. Digital transformation, cost efficiency, and changing customer behavior have made evening counters unnecessary.

Banks that once thrived on aggressive competition and extended hours are now consolidating, with fewer players, less competition, and greater reliance on digital platforms.

For customers, this means fewer physical interactions but far greater flexibility. For banks, it means reduced operational costs but also the challenge of staying innovative in a maturing market.