While Nepalese politics is in crisis, the private sector is booming, says Ashoke Rana, CEO of Himalayan Bank and member of the advisory board of One to Watch.
“Young Nepalese who studied and lived abroad see ample business opportunities in Nepal.”
Solid business plans
When Ashoke Rana, CEO of Himalayan Bank, visited Rockstart Demo Day in Kathmandu in February 2015 he was positively surprised. “A professional programme like Rockstart is new in our country. There is an Entrepreneurship Lab at Kathmandu University, but that is not run as professionally. Rockstart offers great opportunities for businesses to get support and meet investors. For me personally, it has been very encouraging to meet so many wonderful entrepreneurs with solid business plans in Nepal.”
Unfortunately it is not so easy to offer these companies growth financing, admits Rana, whose Himalayan Bank is the third bank of Nepal in size and revenue. “Many start-ups and SME’s do not have solid financial reports and lack the management capabilities that we demand for a bank loan. One to Watch and Rockstart help companies to professionalize quickly and grow their business with the support of impact investors. We are keen to follow the Rockstart alumni and reconsider bank financing in the future.”
SME’s on the rise
The private sector is very dynamic in Nepal, says Rana. “The SME portfolio of all banks in Nepal are on the rise. Many family businesses have come up to replace or compete with products or services that used to be delivered by the government. Think for example of feedstock and agricultural products like fertilizers. More and more young people dare to set up a business – and they are supported by their families as well. We have seen a huge change culturally. In the past, everybody wanted a government job. Not anymore.”
The gained popularity of entrepreneurship is also driven by young Nepalese who studied and lived abroad and want to come back home. “They see ample business opportunities in Nepal, because they have seen how business is done in the US, Europe, Japan and Australia.” At the same time, they are frustrated by the way things are organized by the government. Rana: “Our political system has been in paralysis for years. Government capital spending has been very limited. In fact, Nepal has a budget surplus because of fiscal incompetence. No, we cannot expect much from the government at this point. We are a two-speed country.”