<figure><img width="1342" height="899" src="https://superdesk-pro-c.s3.amazonaws.com/sd-nepalitimes/20221114101140/63720cf99c7e80680e0b789ajpeg.jpg" alt=""/><figcaption>Photo: DARAZ</figcaption></figure>Aanchal Kunwar sits in her office that has an overview of employees of Daraz busy at their desks. A meeting is in progress in  a conference room next door.In January, Kunwar became one of few women in leadership in Nepal’s corporate sector, <a href="https://www.nepalitimes.com/business/anchal-kunwar-at-daraz/" target="_blank" rel="noopener noreferrer">heading the operations of Daraz</a>, the company now owned by China’s Alibaba.Kunwar was working for Amazon in Seattle when a recruiter reached out to her via LinkedIn to let her know that the Managing Director position was open at Daraz in Nepal. “I felt like coming back to Nepal after gaining all the experience would be more impactful than whatever else I could be doing right now in the US,” she says.Kunwar was born and raised in Kathmandu and spent her early childhood moving around the country because of her father’s job. She left for the US after high-school, graduated in maths and economics, and began to work for Carlson Wagonlit Travel (CWT) while doing her MBA. She then worked for Amazon for five and a half years, managing the company’s mass cosmetics business, working in global expansion -- helping launch the platform in countries like Sweden, Poland, Saudi Arabia and Egypt.  “Four years into that job is where I was starting to think --what do I want to do next in my life?” Kunwar recalls.  <img width="126" height="150" src="https://superdesk-pro-c.s3.amazonaws.com/sd-nepalitimes/20221114101140/63720cfb9c7e80680e0b789bjpeg.jpg" alt="">“There was a clear path in terms of just moving up the ladder in the corporate world. But something in me was telling me that wasn't enough, and that I needed not something more, but probably something different, something that I believed would be more fulfilling.”  Kunwar had been considering going into the non-profit sector when Covid hit. “With the pandemic, I thought I’ll just hold my thoughts for a little bit because there were a lot of other things to handle.” When the Daraz opening in Nepal came up, she remembers thinking: “That would be cool.” Daraz would be a perfect fit: she was Nepali, had similar approaches to running a business in terms of being <a href="https://www.nepalitimes.com/latest/nepali-company-wins-global-environment-awards/" target="_blank" rel="noopener noreferrer">socially and environmentally responsible</a>, and a customer focus.  Kunwar’s entry into Daraz coincides with a <a href="https://www.nepalitimes.com/here-now/nepal-e-shopping-booms-under-covid-19/" target="_blank" rel="noopener noreferrer">dramatic growth in e-commerce in Nepal</a> as Nepalis locked up at home during the pandemic began to explore online purchases.   “The pandemic has definitely helped push people towards e-commerce more,” Kunwar notes. “Prior to the pandemic it was probably just the younger generation but during the pandemic, even the older demographics understood the convenience and started buying things online.”  Kunwar is convinced the Nepali market is quick to adopt new technologies, and gives the example of the <a href="https://www.nepalitimes.com/opinion/nepals-e-conomy-rapidly-goes-digital/" target="_blank" rel="noopener noreferrer">growth in e-payments</a>. Even till last year, only 10% of Daraz business was through e-payments, now it is half.  Kunwar’s experience at Amazon has given her insight into how global markets operate, and the unique set of challenges that markets across the world present with legal restrictions, logistics, and tools. Nepal’s challenges include lack of experience in e-commerce which means sellers need the right kind of training and education to be able to answer questions, so buyers have the information they need to make a judgement call, she says. Read also: <a href="https://www.nepalitimes.com/banner/nepals-budding-e-commerce-ecosystem/" target="_blank" rel="noopener noreferrer">Nepal's budding e-commerce ecosystem</a>, Sikuma Rai Another challenge is that Nepal does not have a proper GPS mapping system, and deliveries still have to call people to figure out where exactly they are located. “An unstable government adds to the challenges with banda announcements,” Kunwar says. “And during Covid, if there is a lockdown or odd-even rules, we have to navigate that and ensure proper delivery. These challenges are unique to Nepal, you wouldn’t see them in the US.” She adds, “The companies I worked for in the US are very mature businesses, where processes are defined. Here in Nepal we still have a <a href="http://archive.nepalitimes.com/regular-columns/Cross-Cutting/Start-ups-need-staying-power,439" target="_blank" rel="noopener noreferrer">start-up</a> culture. But we will probably be where Amazon is now in a number of years.”  Daraz currently operates in 47 cities across Nepal, and plans to expand to 80 this year. But Kunwar wants to take one step at a time, and have the logistics in place for growth. “In the last two years, we have had to run before we could walk, but in order to keep growing, we just need to have processes in place,” she says. “We need our key account managers to focus more on strategy and then have execution be more on a lower level.” This is dependent on improvements in connectivity, people being able to shop online, road infrastructure, and mapping systems.   As Daraz Nepal’s managing director, Kunwar joins a growing number of <a href="https://www.nepalitimes.com/latest/women-leaders-set-example-for-rest-of-nepal/" target="_blank" rel="noopener noreferrer">Nepali women taking the lead</a> in the corporate world. “My family raised me no differently than my brother,” she says. “So I’ve always questioned the status quo. I don't take 'This is just how things are’ as an answer.” She admits that there have been instances since she joined Daraz where men in power have shut her down halfway through her introduction.  “It is something that I wish was different but it’s not,” she admits. “But I don't necessarily let that get to me as long as it is not preventing me from doing what I want to do for the business, and for the country.” Kunwar says her driving force is putting in the hard work, and making her presence felt. Outside Daraz, Kunwar is passionate about education for under-served Nepalis and sponsors young students.   She wants to focus on mentorship because even when students have funding for education, they cannot dream bigger because they are stuck in their social milieu.  “I came back to make an impact for Nepal, it is broader than just Daraz,” says Kunwar. “Five years from now, I'm hoping to make some impact here, in addition to taking Daraz to new heights with the team.” Read also: <a href="https://www.nepalitimes.com/opinion/holding-up-half-the-economy/">Holding up half the economy</a>, Ashutosh Tiwari

Shristi Karki

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New Daraz MD seeks to make an impact in Nepal

<img width="1640" height="720" src="https://superdesk-pro-c.s3.amazonaws.com/sd-nepalitimes/20221110161148/636d1d799c7e80680e0af3b8jpeg.jpg" alt=""/>Laxmi Bank is introducing a month-long #DigitalDecember campaign wherein customers can make QR payments and businesses to enroll as a QR Merchant, three of whom can win Rs5,000 each week via lucky draw and five existing users can win 50% cashback up to Rs500 each day. 500 new Mobile Money users that spend over Rs1000 can win Rs500 cashback.

Laxmi Bank's Digital December

<img src="https://superdesk-pro-c.s3.amazonaws.com/sd-nepalitimes/20221110161148/636d1d6b9c7e80680e0af3b3jpeg.jpg" alt="" width="1160" height="280"/>City Express Money Transfer and Ria Money Transfer, a business segment of Euronet Worldwide, have partnered to allow Nepali migrants to send money back home from Ria to the Khalti Digital Wallet, through City Express Money Transfer. Ria currently has over 500,000 locations in over 160 countries, and by partnering with Khalti which has 1.8 million registered users, the partnership allows Nepalis to send and receive remittance real-time in a safe and digitised ecosystem.

City Express, Ria, and Khalti tie up

<figure><img width="1500" height="1000" src="https://superdesk-pro-c.s3.amazonaws.com/sd-nepalitimes/20221110111124/636cd1589c7e80680e08f8aajpeg.jpg" alt=""/><figcaption>Photo: BIKRAM RAI</figcaption></figure>The number of Nepalis on the internet has increased dramatically during the pandemic, with high-speed mobile connectivity accounting for 59% of the total internet users, new figures by the Nepal Telecommunications Authority (NTA) this week show. Some 96% of Nepali households own mobile phones, and the proportion of smartphones with data rose rapidly during the pandemic in 2020.Some 24 million Nepalis, which is 80% of the 2011 population, currently use fixed broadband and mobile internet to browse the internet.While a majority of mobile users have 3G internet, 4G is rising fast as telecom companies encourage users to buy the service through affordable packages. <a href="https://www.nepalitimes.com/here-now/coronavirus-and-the-world-wide-web/">Coronavirus and the World Wide Web</a>, Sonia Awale <img width="652" height="195" src="https://superdesk-pro-c.s3.amazonaws.com/sd-nepalitimes/20221110111124/636cd15b9c7e80680e08f8abjpeg.jpg" alt="">Three telecommunications companies provide 4G Internet services in Nepal: Nepal Telecom, Ncell, and Smart Telecom. Some 6.3 million mobile users currently have access to 4G services— 2.04 million Nepal Telecom users, 4.08 million through Ncell, and 199,000 who are on Smart Telecom. Meanwhile, 5.2 million users have fixed cable and wireless broadband, with 4.8 million among them using wireless services.There are currently 127 registered internet service providers in Nepal, out of which only 40 companies have active users—only six among them are main players in Nepal’s internet market. WorldLink is the biggest service provider in the country with 422,000 active customers.Nepal Telecom, which provides internet services to 900,000 users across the country, has the WiMax Wi-Fi service, ADSL internet, as well as its recent Fibre to the Home (FTTH)—which includes voice, mobile data, and IPTV package. FTTH has already reached 300,000 users.  Nepal’s internet market has long been hampered by high prices, technological limitations and unreliable connectivity even as Nepalis have rapidly built an extensive virtual presence during the pandemic.<a href="https://www.nepalitimes.com/latest/why-internet-speed-is-slower-and-slower/">Why Internet speed is slower and slower</a>, Raju BanskotaThe bandwidth is often too narrow to support heavy traffic in Nepal’s international gateway and local networks. The cross-border connections are through underground fibre optic cable that connects ISPs to India’s Airtel and Tata. As it is, internet consumption <a href="https://www.nepalitimes.com/latest/nepal-internet-use-increases-by-35-during-lockdown/" target="_blank" rel="noopener noreferrer" data-saferedirecturl="https://www.google.com/url?q=https://www.nepalitimes.com/latest/nepal-internet-use-increases-by-35-during-lockdown/&amp;source=gmail&amp;ust=1610004563798000&amp;usg=AFQjCNHxHgaWOdEqAhm6ySiaBpUH8Er9JQ">went up 35%</a> during the first four months of the lockdown as Nepalis shifted their social and professional lives—education, employment, and entertainment—online.Nepal’s baby steps towards distance learning <a href="https://www.nepalitimes.com/banner/lockdown-gives-distance-learning-a-boost-in-nepal/" target="_blank" rel="noopener noreferrer" data-saferedirecturl="https://www.google.com/url?q=https://www.nepalitimes.com/banner/lockdown-gives-distance-learning-a-boost-in-nepal/&amp;source=gmail&amp;ust=1610004563798000&amp;usg=AFQjCNGAbxPMbhNEBChMeNCbaXIAegzzvQ">got a boost</a> as the lockdown replaced schools with virtual classes. But the pandemic also brought to light the glaring digital divide despite widespread mobile connectivity even as it was aided by digital education packages from Nepal Telecom and Ncell.Meanwhile, Nepal’s fledgling <a href="https://www.nepalitimes.com/here-now/nepal-goes-online-shopping-in-2020/" target="_blank" rel="noopener noreferrer" data-saferedirecturl="https://www.google.com/url?q=https://www.nepalitimes.com/here-now/nepal-goes-online-shopping-in-2020/&amp;source=gmail&amp;ust=1610004563798000&amp;usg=AFQjCNEY_idLUU4BYvEylGqhgBRCKaaCAA">e-commerce</a> industry is taking flight as safety concerns and convenience drive internet users to buy and sell online. The pandemic has made Nepalis health-conscious and tech-savvy, with sales of healthy food, fitness and gadgets on the rise. Nepal has also seen an upsurge in digital payments as more and more people use e-wallets to conduct transactions.Nepali internet users, already increasingly <a href="https://www.nepalitimes.com/banner/mobile-nepal-is-hooked-on-youtube/" target="_blank" rel="noopener noreferrer" data-saferedirecturl="https://www.google.com/url?q=https://www.nepalitimes.com/banner/mobile-nepal-is-hooked-on-youtube/&amp;source=gmail&amp;ust=1610004563798000&amp;usg=AFQjCNGmpTmfKbt4d5NqnmFATePQW8cS9g">hooked on YouTube</a>, sought greener pastures on relatively newer social media like TikTok during the lockdown, helped by special offers from telecom companies. The <a href="https://www.nepalitimes.com/here-now/huge-uptick-in-tiktok-during-nepal-lockdown/" target="_blank" rel="noopener noreferrer" data-saferedirecturl="https://www.google.com/url?q=https://www.nepalitimes.com/here-now/huge-uptick-in-tiktok-during-nepal-lockdown/&amp;source=gmail&amp;ust=1610004563798000&amp;usg=AFQjCNENH4WdP1GmnpxO4mqlytuRHXmoVQ">TikTok boom</a>, which now takes up 25% of the bandwidth in Nepal, saw netizens making use of the short-form-video application as a creative and professional outlet.<a href="https://www.nepalitimes.com/banner/how-nepals-media-landscape-is-being-transformed/">Nepal’s changing media landscape</a>, Sharecast Initiative

Covid-19 aids Nepal’s net spread

<figure><img width="960" height="640" src="https://superdesk-pro-c.s3.amazonaws.com/sd-nepalitimes/20221109181116/636be0ed9c7e80680e083e1djpeg.jpg" alt=""/><figcaption>Photo: MONIKA DEUPALA</figcaption></figure>Infi Store had just begun its operation when the government announced a nationwide lockdown in March to contain the spread of coronavirus. Eight months later, the company with its out-of-the-box marketting strategy for delivery in partnership with Pathao ride service, has boomed.Infi’s collaboration with Miniso and innovative schemes like home delivery of live mountain goats and chicken for Dasain, were all the  rage with customers who were wary of venturing to markets because of Covid-19.“We surprised ourselves, our business picked up because of the pandemic fears,” explained Yeshu Thakali of Infi Store. While Infi was the right idea at the right time in <a href="https://www.nepalitimes.com/banner/nepals-budding-e-commerce-ecosystem/" target="_blank" rel="noopener noreferrer">Nepal’s nascent e-commerce ecosystem</a>, pre-existing establishments like Daraz and Sasto Deal continue to dominate the online shopping market. Daraz, which is a subsidiary of China’s Alibaba, this year launched a pandemic iteration of its <a href="https://www.nepalitimes.com/here-now/daraz-finds-nepalis-still-shy-to-shop-online/" target="_blank" rel="noopener noreferrer">11.11 shopping festival</a> timed for Tihar, announcing heavy discounts on products with jacket advertising in all Kathmandu dailies and portals on Wednesday. For the third year in a row, 11.11 has taken urban middle class Nepal by storm. <figure><img width="640" height="360" src="https://superdesk-pro-c.s3.amazonaws.com/sd-nepalitimes/20221109181116/636be0f09c7e80680e083e1ejpeg.jpg" alt=""><figcaption>Lino Ahlering, Managing Director of Daraz.</figcaption></figure>“For us, 11.11 is the biggest sale day in the world led by Alibaba and every November eleventh is a learning process," Lino Ahlering, Managing Director of <a href="https://www.nepalitimes.com/business/daraz-creating-change/" target="_blank" rel="noopener noreferrer">Daraz</a> told Nepali Times.Indeed, Daraz seems to have learnt from mishandling of 11.11 delivery in past years. “2018 was slow, 2019 was fast, 2020 will be much much faster,” Ahlering said. “We are learning from our past mistakes and to rectify them we have added 700 people only for delivery and 200 extra for customer services.” Because of early warning and experience about the Covid-19 pandemic from sister companies in China, Singapore and other South Asian markets, Daraz appears to have been better prepared to take advantage of the lockdown and pandemic. Another online shopping company that has seen unexpected growth during the past months is Sasto Deal, which recently partnered with India’s Flipkart. When Sasto Deal Started out in 2011, Nepal’s Internet penetration rate was only 9%, it has now grown to 60% and is rising rapidly. “The e-commerce potential for Nepal looks more promising than ever, and the Covid-19 crisis with the spread of the Internet has opened up new arenas, including outside Kathmandu Valley,” says Sasto Deal’s co-founder Amun Thapa.Daraz came after <a href="https://www.sastodeal.com/" target="_blank" rel="noopener noreferrer">Sasto Deal</a>  and with its aggressive promotion, took the online retail market by storm. After tying up with Alibaba, it has also benefited from the experience of the larger group with global discounting events like 11.11, which has become a household word and many Nepalis now look forward to the festival sale.Despite the Covid-19 crisis, <a href="http://archive.nepalitimes.com/article/Nepali-Times-Buzz/outdated-laws-limited-ecommerce-hold-back-tech-industry%20,3547" target="_blank" rel="noopener noreferrer">e-commerce</a> companies have pulled out all stops to gain trust from Nepal’s customers, traditionally wary of shopping online and restricted by micro-credit payment restrictions. Collaboration with international partners, India’s Flipkart for Sasto Deal, and China’s Alibaba for Daraz have helped with technology and promotion skills.“Nepal’s culture matches with India so much more, and it was a feasible idea to get in products from Flipkart,” explained Thapa. “Competition is always good and it makes the ecosystem healthy and professional, and competing with an Alibaba affiliate was a huge challenge and also a big learning experience.”Indeed, <a href="https://www.flipkart.com/" target="_blank" rel="noopener noreferrer">Flipkart</a> has the experience of competing with the global giant online store Amazon in India. Both Thapa and Ahlering believe that the Nepal online retail market is big enough for both of them, and has the potential for tremendous growth. If it wasn’t, they say, the international partners would not have joined in.Ahlering of Daraz said that in a developing market like Nepal, there are always challenges to make the whole e-commerce ecosystem much more professional. “Alibaba would have never invested if it did not see a potential here in Nepal. We are very bullish about the market, a lot of people get access to products and that is a win-win situation for the e-commerce market," he added.Sasto Deal recently also got a $1 million investment from the Dolma Impact Fund to help the company achieve a milestone target of Rs1 billion in annual revenue within the next 18 months.Watching the two giants of e-commerce is Yeshu Thakali from Infi Store, and he thinks the two were equipped with technical knowhow and experience of online retail to dive right into the market and seize the opportunity offered by the lockdown, just as his delivery startup did. However, the Covid-19 crisis has also presented new obstacles for e-commerce, the growth is not matched by government policies and laws which have not caught up with the age of online commerce.But if the government can get its act together, there is one important lesson from this year’s pandemic crisis and the festival season -- online shopping is here, not just to stay, but also grow dramatically in Nepal in the coming years.

Nepal e-shopping booms under Covid-19

<figure><img src="https://superdesk-pro-c.s3.amazonaws.com/sd-nepalitimes/20221108151128/636a67909c7e80680e0599e4jpeg.jpg" alt="" width="1500" height="1000"/><figcaption>Photo : MONIKA DEUPALA</figcaption></figure>Much more than today, in the next decade smartphones will become the primary means of accessing the internet in Nepal, making social media an even greater influence in society. At the same time, financial technology, AI and e-commerce will transform the economy.Already, <a href="https://www.nepalitimes.com/banner/how-nepals-media-landscape-is-being-transformed/" target="_blank" rel="noopener">96% of households in Nepal have at least one mobile phone</a> and <a href="https://www.nepalitimes.com/here-now/nepalis-are-drifting-to-digital-media/">more than half of those were smartphones</a>. A survey this year showed that nearly everyone here who accesses the internet does it through a smartphone — and almost everyone who is logged on also has a<a href="https://www.nepalitimes.com/banner/facebook-nation/" target="_blank" rel="noopener"> Facebook account</a>.Read also:<a href="https://www.nepalitimes.com/banner/so-you-want-to-quit-facebook/" target="_blank" rel="noopener">So, you want to quit Facebook?</a>, Reeti KC<a href="https://www.nepalitimes.com/editorial/face-to-face-with-facebook/" target="_blank" rel="noopener">Face-to-face with Facebook</a>, Editorial“Once you are introduced to the smartphone and the features that come along with, it is very difficult to go back, and this trend is growing exponentially,” says Madhu Acharya of Sharecast Initiative, which conducts the annual social media survey. He forecast that the digital divide between urban and rural is going to narrow in the coming decade.“More older people will be accessing the Net through smartphones, which will get cheaper,” adds Acharya. He gives the example of his father, who used to own a feature phone but switched to a smartphone to communicate with grandchildren and relatives abroad through Facebook.Read also: <a href="https://www.nepalitimes.com/here-now/nepal-is-becoming-a-nation-of-net-addicts/" target="_blank" rel="noopener">Nepal is becoming a nation of net addicts</a>, Sabina DevkotaThe trend of using the internet to access media sites is going to grow in coming years, as digital portals replace television to become the key source of national and international news for Nepalis. People will get more and more used to watching content whenever and wherever they like rather than wait for the 7 o’clock news bulletin.In terms of online finances, Sumana Shrestha of Fusemachines says that the latest algorithms will provide a larger section of the population access to financial technology in the coming decade. AI has been making progress in Nepal, and possibly the biggest change will come when the technology that digitises handwritten application forms, through Nepal’s AI Office of Civilian Requirements, will be smart enough to produce an editable document both in English and Nepali.Read also: <a href="https://www.nepalitimes.com/banner/bringing-silicon-valley-to-kathmandu-valley/" target="_blank" rel="noopener">Bringing Silicon Valley to Kathmandu Valley</a>, Sonia AwaleNepal has a wealth of software talent in information technology, and this need to be converted to work with AI, Shrestha says. Fusemachines and other AI-centred companies are already collaborating with local engineering colleges to build a critical mass of AI expertise in Nepal.Kai-Fu Lee, the former president of Google China and an AI expert, wrote the book <a href="https://www.nepalitimes.com/review/the-ai-super-powers/" target="_blank" rel="noopener">AI Superpowers: China, Silicon Valley, and the New World Order</a>. He predicts that in the coming decade a country will forge ahead if it has ‘an army of well-trained engineers and entrepreneurs, AI scientists ... with abundant data and a supportive policy environment’.‘China is able to apply skilled AI in various areas, like healthcare, finance, safety systems and systems for smart houses,’ Lee writes, adding, ‘poor countries will stagnate while the AI superpowers take off.’Read also: <a href="https://www.nepalitimes.com/here-now/can-nepal-invest-in-the-cloud/" target="_blank" rel="noopener">Can Nepal invest in the cloud?</a>, Ganesh AcharyaShrestha thinks Nepal has not done enough in AI adoption compared with other countries. “Nepal has a very young population, which means we can incorporate AI in the curriculum to reach a huge segment of the population, and we are hoping to be able to develop talents within a year or two on a mass scale. There is a tremendous opportunity for Nepal to lead and make a huge impact,” says Shrestha, who sees immediate applications of AI in the tourism industry.“Nepal can zero in on the right kind of tourist and make sure our ads and messaging is getting to them. That will increase the volume of tourists coming to Nepal and will make sure tourists have a good quality of experience,” she adds.Nepal will also have to catch up with its immediate neighbours in opening payment gateways on the Internet and promoting e-commerce. For example, China has already moved beyond phone-based payment with AI-based face recognition systems on Alipay, in which people pay their bills by scanning their faces at a checkout point without having to use their mobiles.Although online payment gateways such as eSewa and IMEPay have been established here, Nepal is still miles away from having a mature <a href="https://www.nepalitimes.com/banner/nepals-budding-e-commerce-ecosystem/" target="_blank" rel="noopener">e-commerce system</a>. The government’s 2019 Digital Nepal Framework admits: ‘The growth of e-commerce in Nepal is inhibited due to the lack of a supporting ecosystem such as limited digital payment options.’While others have already taken a leap in device-free commerce, if Nepal can at least make internet payment through mobile phones secure and convenient during the coming decade, that will already be an achievement.<h2>What do you think will be the most popular IT advancement in the next 10 years in Nepal?</h2><figure><img src="https://superdesk-pro-c.s3.amazonaws.com/sd-nepalitimes/20221108151128/636a67949c7e80680e0599e5jpeg.jpg" alt="" width="1050" height="846"><figcaption> </figcaption></figure><figure><img src="https://superdesk-pro-c.s3.amazonaws.com/sd-nepalitimes/20221108151128/636a67979c7e80680e0599e6jpeg.jpg" alt="" width="1050" height="846"><figcaption> </figcaption></figure><h2>The media is the medium</h2>Despite the migration of eyeballs to digital portals for news, Madhu Acharya says it is too early to declare print media dead. “People still prefer to read news holding a physical paper and there is an archival value that digital doesn’t always have,” he says.A Reuters report found that worldwide, across 38 markets, increasing concern about misinformation is undermining trust in media. Yet in Nepal, Sharecast found trust of traditional media is still high with less concern about disinformation online, especially <a href="https://www.theatlantic.com/international/archive/2019/04/india-misinformation-election-fake-news/586123/" target="_blank" rel="noopener">in comparison to India</a>. Nepalis believe they know what is and isn’t ‘fake news’, but often without verifying links and checking sources.This could hold implications for Nepali politics in the coming decade, especially in federal elections scheduled for 2022 and 2027.“The ideas that float around on social media and digital platforms are extreme,” Acharya tells us. “If politicians decide to listen to these extreme opinions and stop meeting people face-to-face, learning about them and what problems they have, then I think they will be tempted to address fake needs.”

Nepal in the decade of AI

<figure><img src="https://superdesk-pro-c.s3.amazonaws.com/sd-nepalitimes/20221107171148/636937739c7e80680e03fe38jpeg.jpg" alt="" width="1050" height="642"/><figcaption>BHANU BHATTARAI</figcaption></figure>Slippery slope is what banks have been treading on last few weeks by engaging in a price war on deposits. One can understand the soup they are in. Higher interest rates do not bring in significant new deposits, yet they are compelled to raise the rates to retain what they have.They will also be nervous about upcoming outflow from the banking system towards mid January when first tranche of annual corporate income tax is due for payment. Depositors are happy for now but imagine the plight of businesses dependent on bank debt.How long will this credit crunch last? Is there light at the end of the tunnel? Obviously, there will be some relief once government starts releasing payments to vendors and suppliers of various goods, services and developmental works – these are normally bundled toward latter half of a financial year. But judging by how banks behaved last three years, there is no guarantee that the crunch will not resurface next October.Read also:<a style="background-color: #ffffff; font-size: 15px; letter-spacing: 0.01em;" href="https://www.nepalitimes.com/opinion/banks-biting-off-more-than-they-can-chew/" target="_blank" rel="noopener">Banks biting off more than they can chew?</a>, Suman Joshi<a href="https://www.nepalitimes.com/here-now/why-does-the-credit-crisis-keep-repeating-itself/" target="_blank" rel="noopener">Why does the credit crisis keep repeating itself?</a>Band aid solutions will not work anymore. A strong medication must now be administered. It will be painful but, in many ways, <a href="https://www.nepalitimes.com/opinion/banks-biting-off-more-than-they-can-chew/">banks brought it upon themselves</a>. There are fundamental issues with our economy and banking sector that have direct relationships with monetary equilibrium.Here are examples of initiatives banks may consider without any support or concessions from the government or the central bank:Ration credit. Banks resorted to aggressive credit expansion following mandatory increase in paid up capital and in anticipation of rapid economic growth post installation of a stable government. But their reading of monetary environment proved wrong time and again. Deposit mobilisation has not kept pace nor aligned with growth in loan books. The only way forward is to direct credit flow only into areas that will help productivity, until such times that deposit-loan growth mismatch is corrected. In any case, our financial system is banking-heavy and alternative investment options like private equity and venture capital are emerging.Read also:<a style="background-color: #ffffff; font-size: 15px; letter-spacing: 0.01em;" href="https://archive.nepalitimes.com/regular-columns/guest-editorial/banking-crisis-explained,1096" target="_blank" rel="noopener">Banking crisis explained</a>, Suman Joshi<a style="background-color: #ffffff; font-size: 15px; letter-spacing: 0.01em;" href="https://www.nepalitimes.com/here-now/crunching-the-numbers-on-credit/" target="_blank" rel="noopener">Crunching the number on credits</a>, Ramesh Kumar and Sikuma RaiExpansion of formal economy. There is no denying that the Nepali economy is growing, albeit driven mostly by private sector. Private wealth has multiplied in value and people are generally better off than they were. Whilst income disparity may have widened, there are reasons to believe that anticipated government spending on infrastructure and creation of enabling environment will help us continue to grow in the medium term. However, a significant part of the economy is in the shadows of formal transactions. Size of our informal economy is estimated at anything between 50 to 100% of the formal one. And we remain a predominantly cash economy. Regulations aimed at channeling financial transactions through banking institutions must be put to use effectively. Banks, on occasions, have resisted implementing regulatory guidelines on cash transactions for fear of losing deposits. We must expand the formal economy to have more money staying within the banking system. Banks can play a catalytic role in encouraging businesses to avoid cash payments.E-payments. <a href="https://www.nepalitimes.com/banner/nepals-budding-e-commerce-ecosystem/" target="_blank" rel="noopener">Digital banking</a> is also an important tool to help expand formal economy. Banks need to take their ongoing initiatives on digital channels to the next level through deeper collaboration with small businesses. For example, it should be possible for a bank (or a number of banks together) to pilot a No Cash Zone in say Durbar Marg area, or the restaurant district of Jhamel, by getting all shops or restaurants to sign up to a campaign to accept digital or card payments only. These are locations frequented by more affluent customers. It can gradually be replicated elsewhere. Obviously, if people can pay for basic purchases like milk and vegetables conveniently through a credit card or a digital wallet, they will carry less cash. That money will stay as bank deposits until spent.Cooling period. A casualty of rapid business expansion has been quality human resource within the banking industry. Growth in banks’ business and branch network create new positions which are often filled by people with lesser skills and experience. Many young bankers hop-scotch their way up through a number of banks and assume positions of responsibility without necessary skills and experience. Add to that generally aggressive lending behavior with excessive reliance on real estate collateral. Frankly, potential for sub-standard loan assets and operational risk in many Nepali banks is cringe-worthy. The IMF has already expressed their concern over quality and sustainability of unnatural growth achieved by the sector in recent years. Just like a cooling period has been made mandatory for CEOs, a mechanism must be put in place to arrest the tendency among employees at supervisory and managerial levels to move to another bank at short intervals for quick gains. Why would a bank invest on training and grooming an employee if only for another bank to offer him a higher position? Many organizations in the western world have stringent non-compete clauses in employment contracts.Writer’s note: I have been a career banker and spent 24 years in the industry. Some may think I’m critical of banks because I’ve retired from banking profession. But I’ve had a fulfilling banking career and I feel deeply indebted to Nepali banking sector for making me who I am. I strongly believe that this sector needs to be understood in correct perspective. Raising contemporary banking issues is my way of giving back to the industry. Also, it sometimes is not feasible for practicing bankers to voice their concerns. All said and done, banking remains the most transparent sector of the economy; its contributions to economic growth have been unmatched. I will continue to share my dui paisa to help regain its stature as a well-respected sector.Suman Joshi is an ex-banker and Chair of True North Associates, a private equity firm.

Banking on a course correction

<img width="3648" height="2736" src="https://superdesk-pro-c.s3.amazonaws.com/sd-nepalitimes/20221107171148/636937019c7e80680e03fe0fjpeg.jpg" alt=""/>Sunil Nepal works in IT in Kathmandu and has been buying provisions and necessities online for three years. But tech savvy as he is, he did not buy anything online on 12.12 on Wednesday, Nepal’s second online shopping day after 11.11 last month when hundreds of heavily discounted products are on sale online.Nepal was not the only person who did not join in. There wasn’t the usual buzz on social media about 12.12 that there is in Pakistan, the country where Daraz originated -- or the publicity in China, the home base of Daraz’s new owner Alibaba Group. <img width="640" height="344" src="https://superdesk-pro-c.s3.amazonaws.com/sd-nepalitimes/20221107171148/636937049c7e80680e03fe10jpeg.jpg" alt=""><img width="640" height="349" src="https://superdesk-pro-c.s3.amazonaws.com/sd-nepalitimes/20221107171148/636937079c7e80680e03fe11jpeg.jpg" alt="">Managing Director Lino Ahlering of Daraz Nepal says the company has learnt from its lacklustre performance last month: “12.12 will not be as big as 11.11 but we have done a lot to improve our user experience so Nepali customers will not be shopping online only for one day in a year.”The first online shopping day in Nepal named ‘11.11 Sales Day’ on 11 November offered up to 80% discount on some items for customers in Nepal over a 24-hour period. However, even 12.12 did not really take off because of negative publicity in social media about lack of real discounts, and botched deliveries. <figure><img width="640" height="479" src="https://superdesk-pro-c.s3.amazonaws.com/sd-nepalitimes/20221107171148/636937099c7e80680e03fe12jpeg.jpg" alt=""><figcaption> </figcaption></figure>Maybe the country is just not ready yet for e-commerce. It could be that without card payment and online transactions, cash on delivery alone is not enough to take cyber-shopping to a new level.Nepal said he and his friends were excited about the 11.11 sales day before it happened because they had seen Black Friday and Cyber Monday Sales in other countries. He had bought a cleaning gel on Daraz in October, and when Sales Day came, he checked the app again and found a similar product was sold for 76% discount.“That’s a really good deal, but when I clicked the product it was a different story,” said Nepal (pictured right) who bought the gel for Rs249 -- only to find out that the same item could be bought for Rs245 in a shopping mall. “That was just ridiculous, it looked like the campaign was misleading.”Nepal posted his experiences on the Twitter and got hundreds of responses, and the negative publicity made it to the mainstream media as well. In response, Daraz said Nepali buyers had the misconception that the company was a retailer. <figure><img width="250" height="263" src="https://superdesk-pro-c.s3.amazonaws.com/sd-nepalitimes/20221107171148/6369370c9c7e80680e03fe13jpeg.jpg" alt=""><figcaption> </figcaption></figure>Said Managing Director Lino Ahlering: “Daraz is more like a marketplace connecting local sellers with local customers, we have a safety mechanism which does not allow any price increases before the campaign.”Despite the downbeat comments, Ahlering said the 11.11 campaign broke all records for Sale Day, its first since Daraz was bought by China’s e-commerce company, the Alibaba Group. The 11.11 event has been held in China for the last nine years, with more than $30 billion in sales this year on 11 November, which in China is marked as Singles’ Day – as opposed to Valentine’s Day for couples. Even though Nepalis were unaware of the concept of a Singles’ Day and 11.11, Daraz’s brand manager Salina Nakarmi said the portal sold 1,000 Poco phones in less than 30 minutes and almost 50,000 orders were received in 24 hours.  Daraz would not disclose daily sales figures, but Binod Krishna Shrestha of Kathmandu University said that the marketing site does not yet command enough of a brand loyalty yet because most people do not find online purchases trustworthy.  Sixit Bhatta, co-founder of the motorcycle ride-sharing app Tootle, says he is puzzled about why Daraz decided to replicate 11.11 in Nepal.“When you run any campaign, it needs to be culturally contextual. So the first thing I felt was that 11.11 and 12.12 didn’t connect with the Nepali public,” Bhatta (pictured right) said. <figure><img width="640" height="543" src="https://superdesk-pro-c.s3.amazonaws.com/sd-nepalitimes/20221107171148/6369370d9c7e80680e03fe14jpeg.jpg" alt=""><figcaption> </figcaption></figure>Ahlering is aware of the need to be culturally aligned with the market, but said young Nepali customers are catching on to online shopping. He says Daraz will work on educating buyers through social media, video tutorials and media outreach.He added: “I wouldn’t say everything is perfect now. I think we have a great foundation, but there is still a lot to do.”

e-commerce