Government Moves to Absorb Dormant Bank Funds, Pushes Digital Overhaul of Revenue System

Kathmandu — In a significant policy shift aimed at strengthening domestic resource mobilization, the government has announced that funds lying idle in bank and financial institution accounts for over a decade will be brought into the state treasury. The decision, included in the government’s 100-day action plan, targets unclaimed deposits that have remained inactive for years, reflecting an effort to unlock underutilized financial resources within the economy.

According to the plan, authorities will identify accounts that have been inactive for 10 years or more, verify ownership claims, and transfer unclaimed balances to the government through a defined legal process. Officials say the initiative is not merely a revenue-raising measure but also part of a broader strategy to improve the efficiency of public resource management. The government aims to complete the identification and documentation process within 90 days, signaling urgency in executing the reform.

From a policy perspective, the move highlights a shift toward maximizing internal resources at a time when fiscal pressures remain high. Large volumes of dormant funds in the banking system represent idle capital that neither contributes to credit expansion nor supports economic activity. By bringing such funds into the treasury, the government expects to enhance liquidity for public investment, although concerns remain about ensuring due process and protecting legitimate ownership rights.

Parallel to this initiative, the government has placed strong emphasis on modernizing the revenue system through digital transformation. Mandatory implementation of e-billing for large businesses within a month is expected to improve transparency in transactions and reduce tax evasion. This measure aligns with the broader goal of formalizing the economy and strengthening compliance, particularly among high-turnover enterprises where leakages have historically been significant.

The Ministry of Finance has been tasked with preparing a comprehensive roadmap within 45 days to automate tax administration, simplify taxpayer services, and improve overall revenue management. Increased use of technology in tax systems is expected to minimize human discretion, reduce corruption risks, and enhance efficiency in collection processes.

Another structural reform announced by the government is the consolidation of more than 139 fragmented public funds currently operating under different headings. These funds, often criticized for duplication and inefficiency, will be merged within 60 days into a more coordinated framework. The objective is to channel resources into high-return projects and improve the overall effectiveness of public spending.

Taken together, these measures signal a broader attempt to enforce fiscal discipline while expanding the government’s revenue base. The combination of reclaiming dormant funds, digitizing tax systems, and rationalizing public funds suggests a shift toward a more centralized and performance-oriented fiscal architecture.

However, analysts caution that the success of these reforms will depend heavily on implementation. Legal clarity around unclaimed deposits, institutional coordination, and the capacity to enforce digital compliance will be critical factors. If executed effectively, the reforms could mark a turning point in Nepal’s fiscal management; if not, they risk becoming another set of well-intentioned but underdelivered policy commitments.