Kathmandu. Policy reforms related to investment funds, securities market, banks and financial institutions, insurance and insolvency are necessary to promote long-term investment while maintaining good governance in Nepal’s financial sector.

According to the Nepal Infrastructure Summit-2026, the financial sector reform proposals have been prioritized to ease the investment environment, increase transparency among financial institutions and mobilize long-term capital in the infrastructure sector.

The proposed reform proposes that the income of the specialized investment fund should be considered as the income of the unit holder and an environment should be created to facilitate the inflow of foreign investment into the investment fund. This is expected to help in capital mobilization and investment expansion through the investment fund.

It has been proposed to make the process of issuing shares of under-construction hydropower projects on the stock market, easing the process of approval of right shares and making the selection of the chairman of the Securities Board of Nepal based on open competition. The regulatory structure of the stock market and making the process of selection of office bearers transparent have also been given priority in the reform.

Similarly, it has been proposed that the investment of Citizen Investment Trust and Social Security Fund should be linked to infrastructure development. It has been pointed out that there is a need to make arrangements for project preparation, cash flow-based project loans and investment in Infrastructure Development Bank.

The proposal also includes the need for independent evaluation of high-risk investments and control over transactions with the concerned parties. It has been emphasized that the social security fund should expand investment opportunities in the infrastructure development sector.

In the reform related to banks and financial institutions, the definition of ‘associated person’ should be extended to the real beneficiaries, the names of the concerned persons and clarity on the old dues and effective supervision of foreign ownership and investment have been raised.

On the insurance sector, independent expertise and corporate governance, risk management, transparency of actuarial and delegation of rights should be clearly defined.

The insolvency provision also includes simple and effective insolvency process for small and medium companies, restructuring and systematizing the meeting of creditors and voting process.

These reforms in the financial sector are expected to boost investor confidence, effectively mobilize financial resources and provide long-term capital for infrastructure development.