Nepal’s first fully digital banking service, OrangeNXT, is being shut down. Yeah, the one and only. You might think, “wait, wasn’t this supposed to be the future of banking?” Well, apparently not. Nepal Rastra Bank (NRB) has just ordered Laxmi Sunrise Bank to close the service, which means OrangeNXT’s customers now have to move back to traditional banking services.
OrangeNXT has been around for over one and a half years, launched in January 2024 by Laxmi Sunrise in partnership with FoneNXT. This neobanking platform was a fully digital experience, with no paperwork or visiting a physical location. Just a smartphone and a stable internet connection were all you needed.
OrangeNXT to be shut down
No wonder the young people loved it, and so did Nepalis living abroad. In fact, over 65,000 users signed up to OrangeNXT, holding deposits worth NPR 170 million. And it had some pretty clever features too. Gamified savings, personalized accounts, video KYC, etc. All that jazz. We tried it ourselves as well, and were pretty impressed by how feature-rich and easy it was to use. You can read all about it in our review here.
But now, all that gets undone because NRB says the proper legal framework for all-digital banking platforms isn’t ready yet. Which is quite strange because NRB’s own monetary policy for 2025/26 is clearly pro-neobanks. And did I mention that OrangeNXT had already been up and running since January 2024?
How does this affect the customers?
With NRB’s cruel directive, all those 65,000 OrangeNXT customers will now need to migrate to traditional banks for their services. Imagine trying to explain that to your parents or relatives who are not tech-savvy. And speaking to The Kathmandu Post, Laxmi Sunrise Bank’s information officer, Mr. Piyush Raj Aryal, said:
“We are the first bank to launch a fully app-based digital banking product, so the central bank is examining its potential risks, compliance issues, and other legal dimensions. Once the NRB completes its assessment, it may provide a way forward. For now, the product has been put on hold”.
A global perspective
The concept of neobanking may be news to our parts of the world, but it’s absolutely huge in countries like India, Brazil, the UK, China, Germany, and the US. Some rely on partnerships, some have independent licenses.
Brazil’s NuBank, for example, became Latin America’s largest fintech bank with over 122 million customers across Brazil, Mexico, and Colombia. The Philippines has multiple neo-banks. Even India has fully digital banks like OrangeNXT. And yet in Nepal, the first attempt is being shut down before it has had the chance to fully spread its wings.
The bigger picture
But of course, this isn’t the Nepal Government’s first rodeo. We have seen a similar fate handed out to ride-sharing apps like Pathao in the past as well. Yatri Motorcycles struggled with regulations, too. Whenever something new comes along, instead of making rules and frameworks, the government’s first instinct seems to be shutting them down.
My final words
Yeah, I think it makes sense to question this official approach. NRB’s action leaves Nepal behind in fintech adoption, frustrates users, and halts progress. And yet, the discussion about neobanks is still alive on paper. Will neobanking ever truly arrive in Nepal this year? We don’t know. But if OrangeNXT is any indication, the road ahead is going to be… bumpy.
