Nepal's Supreme Court has ruled that the National Identity Card (NID) or its number cannot be the sole mandatory basis for identifying citizens for banking services, addressing difficulties faced by customers who have not yet obtained the document.
A joint bench of Justice Sapana Pradhan Malla and Meghraj Pokharel issued the order on Friday, October 9.
The court partially struck down the provision of Nepal Rastra Bank's Unified Directive, 2082, to the extent that it made the NID or its number the only basis for identifying citizens. Banks and other authorities are directed to provide services using other identity documents, including citizenship certificates, until a citizen receives the National ID or number. The alternative documents must undergo a two-stage verification process.
Advocate Sarita Adhikari filed the petition against the Office of the Prime Minister and Council of Ministers, the Ministry of Home Affairs, the Department of National ID and Civil Registration, Nepal Rastra Bank and Nepal Investment Mega Bank Limited. It challenged the requirement to provide an NID or NID number to update Know Your Customer (KYC) details or change a registered mobile number.
The petition said the requirement caused difficulties for people who had not yet received their cards, including senior citizens, persons with disabilities, people without reliable access to technology and existing account holders who needed to update their information.
The ruling does not remove identity verification. Banks must still comply with KYC and anti-money laundering requirements. Nor does it mean every banking service will be available with a citizenship certificate alone. The court also directed the authorities to move forward with a comprehensive, independent data-protection law to protect personal information, privacy and digital rights.
It is not yet clear how quickly customers without an NID will be able to use the order. Nepal Rastra Bank has not been reported to have issued a circular on implementation, and it has not been confirmed whether commercial banks have begun accepting alternative documents.
