Nepal’s financial system has long been effective at serving asset-heavy industries, but it has struggled to keep pace with the realities of the digital economy. As technology companies grow across the country, the gap between innovation and access to finance has become increasingly visible.

Traditional lending systems are designed around physical collateral, while most tech founders are young entrepreneurs who do not own land or fixed assets in their own names. As a result, otherwise viable companies are often excluded from institutional credit.

Technology companies operate very differently from traditional sectors such as manufacturing or trading. They are asset-light by nature. Their real value lies in intangible assets such as software, intellectual property, skilled teams, client relationships, and predictable cash flows. However, Nepal’s lending landscape continues to prioritize tangible assets, creating a mismatch between how tech companies create value and how banks assess risk. This disconnect limits the sector’s ability to invest, scale, and compete.

Through NIIC 2, and in partnership with Global IME Bank Limited, this gap is being addressed through a collateral-free, cash-flow–based lending facility tailored for eligible tech companies under the NIIC 2 fund. The facility is designed to align finance with the operating realities of technology businesses, rather than forcing them into models built for asset-heavy sectors.

Why cash-flow–based lending fits tech companies

Cash-flow–based lending shifts the focus from what a business owns to how it performs. Instead of relying on land or buildings as security, the model evaluates revenue consistency, client contracts, scalability, and long-term growth potential. For technology companies, this approach reflects their true strengths.

By recognizing cash flows and business fundamentals as indicators of creditworthiness, this model removes one of the most significant barriers to financing in the tech sector. It also encourages better financial management, transparency, and accountability, helping companies build stronger and more sustainable relationships with formal financial institutions.

Early traction from the NIIC 2 portfolio

Two NIIC 2 portfolio companies are already demonstrating how this financing model can support growth.

CloudLaya is among the first NIIC 2 participants to secure a collateral-free, cash-flow–based loan through the facility. Combined with the technical assistance support provided through NIIC 2, the financing is enabling the company to launch new products, expand its service offerings, and enter new markets.

Following this, Peace Nepal Dot Com, through NIIC 2, also secured a collateral-free, cash-flow–based loan from Global IME Bank. As the second company to receive financing under this newly launched model, Peace Nepal is using the loan alongside post-loan technical assistance to strengthen its product portfolio, deepen its market presence, and support long-term growth.

Building a stronger tech financing ecosystem

These early cases point to a broader shift in how innovation-driven businesses can be financed in Nepal. Cash-flow–based lending, when combined with targeted pre-loan preparation and post-loan technical assistance, offers a practical and scalable pathway for tech companies to grow without being constrained by traditional collateral requirements.

This initiative is part of NIIC 2’s ongoing commitment to building a more inclusive, responsive, and future-ready entrepreneurial ecosystem.

NIIC 2 is supported by the Swiss Agency for Development and Cooperation and implemented by One to Watch.