KATHMANDU: From business transactions to personal loans, the number of cases filed over bounced checks is increasing across Nepal every year.

According to statistics from the Nepal Police Headquarters, a total of 38,948 check bounce cases were registered in the past three fiscal years.

SSP Ramesh Thapa, spokesperson at the Police Headquarters, informed that 12,030 cases were filed in FY 2022/23, 13,246 in FY 2023/24, and 13,648 in FY 2024/25.

In just these three years, the total claimed amount from check bounce cases exceeded Rs 80.90 billion. In total, banking offense cases (including bounced checks) reached a claim amount of Rs 85.38 billion in the same period.

“Cases related to banking offenses are increasing annually,” said SSP Thapa. “While the number of cases is rising, the total claim amount shows a fluctuating trend.”

In FY 2022/23, there were 12,052 banking offense cases claiming Rs 50.30 billion. By FY 2023/24, the number of cases increased to 13,246, but the claim amount decreased to Rs 15.80 billion. In FY 2024/25, cases rose further to 13,661 with a claim of Rs 19.27 billion.

Check bounce cases account for 99% of all banking offense cases. In FY 2022/23, out of 12,030 cases, Rs 47.50 billion were check bounce claims. The figure was Rs 15.80 billion in 2023/24 and Rs 17.59 billion in 2024/25.

The number of arrests for check bounce cases is also significant. Police data shows that 2,382 individuals were arrested in FY 2022/23, 3,400 in 2023/24, and 3,133 in 2024/25.

SSP Thapa attributes 99% of banking offense cases being check bounce-related to declining trust in check-based transactions. Other banking crimes like unauthorized account manipulation, document forgery, or online fraud are minimal in comparison.

He noted that the rampant practice of issuing and accepting checks without ensuring sufficient balance in accounts is a primary cause. “Bounced checks are shaking the very foundation of trust in commercial dealings, leading to disputes and financial insecurity,” said Thapa.

Despite continuous warnings from Nepal Rastra Bank urging caution in issuing checks, the trend has not improved. Delays in legal proceedings, ineffective fines and punishments, and easy bail releases contribute to recurring offenses.

Small business owners, retail suppliers, and individual lenders are often victims of bounced checks. SSP Thapa emphasized the need for stricter legal measures and efficient enforcement to protect victims’ interests.

“Check bounce has become a normalized offense in recent years. The habit of distributing checks without ensuring funds is spreading in the business community. Weak enforcement and slow legal processes have failed to curb this practice,” Thapa said.

He further warned that the misuse of checks, traditionally considered a ‘trust-based instrument’, is increasing uncertainty and insecurity in the market. While cyber-related financial crimes are rising globally, in Nepal, such cases are rare and countable.

“Whether cyber offenses are truly low or just not reaching legal action is a matter of investigation. But the reality is, in Nepal, check bounce dominates banking offenses,” Thapa added.

Currently, the police are investigating check bounce cases under the Banking Offense (Amendment) Act, 2025, treating them as criminal offenses. Earlier, cases were handled under the Banking Offense Act, 2008.

Under the 2008 Act, courts would impose fines equivalent to the bounced amount and up to three months’ imprisonment. The amended 2025 Act has introduced stricter punishments.

As per the amendment, bounced amounts up to Rs 1.5 million can result in one month imprisonment. For amounts up to Rs 5 million, the sentence is up to three months. For Rs 10 million, it’s up to one year, and for amounts exceeding Rs 100 million, imprisonment ranges from two to four years.

“If someone’s check is bounced and they seek legal action, they can file a complaint at the nearest police office, providing a copy of the bounced check, the bank’s dishonor statement, and evidence of the loan or transaction agreement,” explained SSP Thapa.