Bank Supervision in Nepal Essay

Banks be the pillars of economy in real capitalistic market of a nation. They are prime sources of investment that play spanking voice in mobilizing resources to an optimum level in business world. The role of banking sector in economic growth and stability requires continuous and received service. In Nepal, Nepal Ratra Bank (NRB) is only if an authorized body responsible for the financial regulation and supervision of all banks and financial institutions licensed by it. It regulates harm and balance of payments stability, manage liquidity, develop a sound payment system, and put forward financial services and financial stability of the nation. The use of randomness engineering science (IT) by financial sector creates numerous challenges of managing and governing it in at onces context.Issues of tackling with changes in technology, migrating system from one to another, uphold adequate inhering control system and managing other IT related essays are emerging in banking se ctor. Frauds through debit and credit cards, ATM, internet banking, mobile banking have increase the risk of financial loss along with other banking risks. Technology risk is not only refer with operation risk of the bank, other banking risks worry credit risk, reputation risk, compliance risk, market risk, strategic risk are also increased due to it. In this scenario, there must be a guideline to regulate sound and robust risk charge technology that strengthens system security, reliability, availability and business continuity.Banks licensed by NRB should maintain the prescribed level of capital fund while opening branches only at prescribed locations. Every NRB reports submitted by bank should be vapourific and must be properly reviewed and verified by NRB. Credit information bureau of every client must be recorded and submitted to the concerned authorities for any credit or loan functionalities. To defend guilty users from accessing banking system, it is essential to well edu cate customers to guide banking operation securely. Similarly, it is also of import to educate other stakeholders including its employees to create effective information security practice.Summarizing up, NRB creation an apex body, it should seriously pursue various policies, strategies and actions to maintain the stability in price and consolidate the balance of payments for sustainable development of the economy of Nepal. The change magnitude complexity of IT in banks creates significant risk to which comprehensive risk centering comprising of various standard internal control framework, banks experience requirement and NRB requirement must be apply. To ensure effectiveness of implemented control framework and adequacy of the adopted security plan and procedures, banks should conduct Information System (IS) audit annually. They should clearly provide information active the services, cost, security features, risk and benefits of electronic banking environment.