NRB, IFC sign agreement for trial phase of 'Psychometric Scoring Solution'

Suman Kumar Adhikari (right), Executive Director at Microfinance Institutions Supervision Department of Nepal Rastra Bank, and Babacar Sedikh Faye, IFC Resident Representative for Nepal shake hands after signing memorandum of understanding (MoU) in Kathmandu, on Tuesday, February 1, 2022. Photo: NRB

KATHMANDU: Nepal Rastra Bank (NRB) and the International Finance Corporation (IFC) signed an agreement to test a method of assessing potential debtors based on individual capacity, behaviour, style and qualification measurement called ‘Psychometric Scoring Solution’ in Nepal’s financial sector.

It is expected that psychometric scoring will make the system more technology-friendly by promoting the disbursement of credit in the financial system and promoting simple and risk-free credit flow.

Suman Kumar Adhikari, Executive Director at Microfinance Institutions Supervision Department and Babacar Sedikh Faye, IFC Resident Representative for Nepal signed the memorandum of understanding (MoU) today in presence of Governor Maha Prasad Adhikari for the trial phase of the innovative method aimed at promoting digital financial services.

The method is being tested in Nepal’s financial system in partnership with the Government of Japan and the United Kingdom (UK) for a period of two years.

This method is expected to bring micro and retail borrowers and micro, small and medium enterprises (SMEs) under the purview of formal financial services. It is expected to enable banks and financial institutions to create risky profiles based on a statistical analysis of the personality and psychological characteristics of the potential borrower and to attract and simplify the client to consume the loan to be included in the formal financial services.

It is believed that this would facilitate the expansion of financial services to the service recipients who did not have access to financial services in the past.

Stating that the IFC and NRB have been cooperating in strengthening Nepal’s financial sector, Governor Adhikari expressed confidence that the implementation of the new agreement would make microfinance management technology-friendly.

Similarly, Faye, Resident Representative of the IFC, thanked the central bank for providing the opportunity for new cooperation and expressed confidence that the agreement would help in expanding financial access.

Present on the occasion were Deputy Governors of NRB, Neelam Dhungana Timsina and Bam Bahadur Mishra, Executive Directors Nephil Matangi Maskay and Dev Kumar Dhakal among other officials of the bank.



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