The government has introduced new provisions permitting state-operated pension funds to invest in a broader range of capital market instruments, to mobilize billions of rupees that have remained largely idle.
Under the revised arrangement, the Employees Provident Fund (EPF), Citizens Investment Trust (CIT), and Social Security Fund (SSF) are now authorized to invest in mutual funds, private equity, and venture capital funds. The changes were introduced through the “Ordinance to Amend Certain Nepal Acts,” issued by President Ram Chandra Poudel on the recommendation of the government. The ordinance amended the CIT Act, EPF Act, and the contribution-based Social Security Act.
Previously, these institutions were mainly limited to investments in fixed deposits, government bonds, and shares of hydropower companies. With the new provisions, the CIT can now invest not only in bank and insurance company shares but also in mutual funds and venture capital instruments approved by the Securities Board of Nepal.
Likewise, the EPF, which had previously managed only its own collective investment schemes, is now allowed to participate in external mutual funds and venture capital initiatives. The SSF has also received authority to diversify its investment portfolio into private equity and mutual funds.
Officials believe the reform will help generate higher returns for contributors while increasing liquidity in Nepal’s capital market. The policy is also expected to create greater institutional investment opportunities for startups and emerging businesses.
At present, the EPF manages more than Rs 500 billion collected from approximately 578,000 general contributors and 96,000 pension fund contributors. The CIT oversees nearly Rs 300 billion belonging to over 800,000 Nepalis, while the SSF has accumulated more than Rs 102 billion from around 2.75 million contributors as of February 2026.
