NEPSE Enforces National ID For Stock Trading: Ensuring Transparency and AML Compliance
3rd August 2025, Kathmandu
In a significant move aimed at bolstering transparency and combating money laundering within Nepal’s burgeoning capital market, the use of the National Identity Card (NID) has been made mandatory for all new stock trading accounts.
NEPSE National ID stock trading
This directive, issued by the Nepal Stock Exchange (NEPSE), marks a crucial step towards aligning the Nepalese financial sector with international Know Your Customer (KYC) and Anti-Money Laundering (AML) standards.
Effective immediately, all Nepali citizens seeking to open new stock trading accounts are now required to provide either their physical National Identity Card or their National Identity Card number. This new policy directly follows instructions from the Securities Board of Nepal (SEBON), emphasizing the regulatory push for robust compliance measures based on the country’s national digital identity system.
NEPSE has also promptly instructed its trading members, particularly those operating their own Trading Management Systems (TMS), to undertake the necessary technical preparations to integrate this new requirement into their platforms seamlessly. This ensures a smooth transition and widespread adoption across the market.
The Nepal Stock Exchange anticipates that this new mandatory NID policy will dramatically improve the transparency of stock market transactions. By linking trading accounts directly to a verifiable national identity, the measure is expected to be highly effective in preventing illicit financial activities, including money laundering, thereby fostering a more secure and trustworthy investment environment.
This initiative is a cornerstone in the ongoing digitization and regulatory strengthening of Nepal’s capital markets. It not only enhances the integrity of the stock market but also reflects Nepal’s commitment to modernizing its financial infrastructure and upholding global financial compliance benchmarks. The mandatory NID requirement is a progressive step that will undoubtedly contribute to the long-term stability and growth of the Nepalese capital market.
About Nepal Stock Exchange (NEPSE)
The Nepal Stock Exchange, abbreviated as NEPSE, was established under the Companies Act of 2006 and operates under the Securities Act of 2007. The basic objective of NEPSE is to impart free marketability and liquidity to government and corporate securities by facilitating transactions in its trading floor through members, market intermediaries, such as brokers, market makers, etc. NEPSE opened its trading floor on 13th January 1994.
Structure
The current paid-up capital of NEPSE is NRs. 1,00,00,00,000.
The shareholders of NEPSE include the Government of Nepal, Nepal Rastra Bank, Employees Provident Fund, Rastriya Banijya Bank (former Nepal Industrial Development Corporation), Laxmi Bank Ltd, Prabhu Bank Ltd, and other securities businesspersons (brokers).
The following table shows the percentage of shareholding by respective shareholders:
| S.N. | Shareholders | Ownership (%) | No. of Shares |
|---|---|---|---|
| 1 | Government of Nepal | 58.66% | 58,66,000 |
| 2 | Nepal Rastra Bank | 9.5% | 9,50,000 |
| 3 | Employees Provident Fund | 10.00% | 10,00,000 |
| 4 | Rastriya Banijya Bank | 11.23% | 11,23,000 |
| 5 | Laxmi Bank Ltd | 5.00% | 5,00,000 |
| 6 | Prabhu Bank Ltd | 5.00% | 5,00,000 |
| 7 | Others | 0.60% | 60,000 |
History
The history of the securities market in Nepal began with the flotation of shares by Biratnagar Jute Mills Ltd. and Nepal Bank Ltd. in 1937.
Significant milestones:
1964: Introduction of the Company Act and first issuance of Government Bond.
1976: Establishment of Securities Exchange Center Ltd.
The Securities Exchange Center was set up to facilitate and promote the growth of capital markets. Before becoming NEPSE, it was the only capital markets institution undertaking brokering, underwriting, public issue management, and market making for government bonds and other financial services.
In 1993, the Government of Nepal, as part of a capital market reform initiative, converted the Securities Exchange Center into the Nepal Stock Exchange (NEPSE).
Members
Members of NEPSE are permitted to act as intermediaries in the buying and selling of government bonds and listed corporate securities.
Total Member Brokers: 92
These brokers operate on the trading floor as per the Securities Act of 2007, rules, and by-laws.
Broker houses and branches are spread across different cities of Nepal.
For more: NEPSE National ID stock trading
