What to do with money when someone dies in Nepal: bank, FD, PF, insurance, and shares

When my uncle died, the family knew about the house and the bank account. What surprised everyone was the rest: a fixed deposit nobody had mentioned, a provident fund balance from a job he left a decade ago, around 400 kitta of shares sitting in a Mero Share account, and a life policy with a premium receipt in a drawer. Five different institutions, five different counters, and one realisation, that none of them would release a rupee without the same set of papers, copied and notarised, over and over.

The single most useful thing the family learned was that the नाता प्रमाणित, the relationship certificate from the ward, is the master key. Almost every claim asks for it. Get it right early and the rest is queueing; get it wrong, or hit a family dispute, and the whole thing moves to court.

This post walks through each asset a Nepali household actually holds, the documents each institution wants, and the traps that turn a two-week errand into a two-year one. It is the operational companion to the inheritance and wills post, which covers who legally inherits; this one covers how you actually get the money out.

The documents you gather once

Every institution wants its own form, but the underlying evidence is the same. Assemble this set, get clean notarised copies, and you stop re-running the ward and the notary for each claim.

Document	Where it comes from	Why every institution wants it
Death registration certificate	Ward office (under the civil-registration law)	Proves the death and starts every claim
Citizenship of the deceased	Already held / ward records	Identifies the account or policy holder
Citizenship of each claiming heir	Already held	Identifies who is entitled to receive
Relationship certificate (नाता प्रमाणित)	Ward office, or district court if disputed	Proves the claimant is a legal heir
Consent / no-objection of other heirs	Notarised affidavit	Stops one heir claiming over the others

The relationship certificate is the pivot. For an uncontested case the ward office issues it in one or two working days for a small fee. Where the lineage is contested, citizenship is missing, or heirs are fighting, only the district court can establish it, hearing evidence and sometimes ordering DNA testing. That fork, ward versus court, is the single biggest determinant of how long the whole process takes.

Bank accounts and fixed deposits

A bank account is usually the first claim and the one that teaches the family the pattern.

With a registered nominee, the bank's job is simple: the nominee presents ID, the death certificate, and the relationship certificate, and the funds are released. With no nominee, the bank has to be satisfied the claimants are the legal heirs, which often means a succession or legal-heir determination first. A nominee, it is worth understanding, is widely treated as the person who receives the money on behalf of the estate, not automatically its final owner where other heirs exist; the law of succession decides who ultimately keeps it.

Two things slow families down here. First, accounts they did not know about. At the end of the last fiscal year Nepal had over 19 million inactive accounts holding roughly Rs 188 billion, much of it unclaimed simply because heirs never knew it existed. A savings account untouched for more than three years is classed dormant, and under Section 112(3) of the banking law deposits unclaimed for 20 years eventually move to a Nepal Rastra Bank fund. Second, the fixed deposit. Whether the early-closure penalty is waived on death is a bank-by-bank policy in Nepal rather than a published national rule, so ask the specific bank rather than assuming.

Provident fund, CIT, and gratuity

The retirement buckets each have their own claim, and two of them add a death benefit on top of the balance.

• Employees Provident Fund (Karmachari Sanchaya Kosh). The accumulated balance, principal plus interest, is paid as a lump sum to the nominated person; if that nominee has also died, it passes to the legal heir. If the member died during service, the fund pays a funeral grant of Rs 40,000, and accident deaths carry additional compensation. The family files the death-claim form with the standard document set.
• Citizen Investment Trust (CIT). The balance goes to the closest legal heir against the death certificate, relationship certificate, and the heir's written request with citizenship copies; accidental death needs a police report. The Citizen Pension Scheme also pays a Rs 10,000 lump sum towards final rites.
• Gratuity and final settlement. Under the Labour Act 2074, gratuity of roughly one month's basic salary per year of service forms part of the deceased's final settlement, payable to the heir, with the first Rs 5 lakh tax-free. The switching-jobs post and the gratuity post cover how these three buckets behave in normal life.

The Social Security Fund: a pension, not just a balance

The SSF is different in kind. For a contributor, it does not just hand the family a balance; it pays the dependants an ongoing pension, which can be the single largest financial event of a death.

Under the contribution-based scheme:

• A surviving spouse receives a pension of 60 percent of the deceased's basic salary, for life, conditional on not remarrying.
• Dependent children receive an education allowance of 40 percent of basic salary until 18, extendable while studying (sources differ on whether the cap is 18 or 21), for up to two children.
• If there is no spouse or children, dependent parents receive 60 percent on a pro-rata basis.
• A funeral grant of Rs 25,000 is paid.

There is a trap with sharp edges. For a non-work-related death, the contributor must have at least 12 months of regular contributions, and the law requires employers to deposit contributions within 15 days of month-end. Families have been denied benefits because the employer remitted late, even though the lapse was the employer's, not theirs. If a family member is an SSF contributor, it is worth confirming the employer is actually depositing on time while everyone is still alive.

Shares and the Demat account

Shares move to the heir by a process called transmission, which is distinct from a voluntary transfer between living people.

For shares held in a Demat account, the heir submits a Transmission Request Form to the Depository Participant, the bank or broker that holds the account, with an attested death certificate, citizenship copies of the deceased and the heir, a relationship certificate, and a consent letter from any other heirs. CDSC then publishes a public death notice with a window, typically about a month, allowing objections before the shares are moved. SEBON authorised CDSC to handle this so families no longer have to chase NEPSE in Kathmandu directly.

The painful case is physical certificates that were never dematerialised. Those must be claimed company by company, each with its own paperwork, rather than through a single DP. The Mero Share and Demat post covers why getting holdings into Demat while the owner is alive saves the family this exact headache.

Life insurance, in brief

A life policy is often the largest single payout, and it has its own detailed claim path, covered in the life insurance death-claim post. The short version for this checklist: the nominee or legal heir files a death claim with the Nepal Insurance Authority-regulated insurer, submitting the original policy, the notarised death certificate, citizenship copies, and the relationship certificate, plus a police report and post-mortem for any accidental or unnatural death. The insurer is required to settle a valid claim within a set window once documents are complete. Whether the policy was kept in force, the named nominee, and the cause of death are what decide how cleanly it pays.

Property and vehicles

Land and a vehicle transfer by नामसारी (name transfer), and both lean on the same relationship certificate.

Land moves at the Land Revenue Office (मालपोत) against the death certificate, the relationship certificate, citizenships, the lalpurja, and the consent of co-heirs; a dispute becomes a partition (अंशबन्डा) or succession suit in district court. A vehicle transfers at the Transport Management Office with the death certificate, heir proof, citizenships, and the bluebook. The women's property rights post covers the registration discounts and the daughter's and widow's share that often sit underneath these transfers.

What you actually need to know

Three things that save a grieving family the most time and money:

1. Get the relationship certificate first, and get the nominees right while everyone is alive. The नाता प्रमाणित unlocks almost every claim, and a named nominee on each account turns a court matter into a counter matter.
2. The SSF and provident fund are not just balances. A surviving spouse's 60 percent pension and the dependant grants can dwarf the account totals, but the SSF benefit can be lost to an employer's late deposit, so verify contributions are current.
3. Money you do not know about is money you do not get. With Rs 188 billion sitting unclaimed, the real failure mode is not paperwork, it is that the family never knew the FD, the old PF, or the share account existed. Write down where everything is.

Dealing with a specific estate, a missing nominee, or an institution that will not release funds, and want to think through the order of operations? Email parjanya57@gmail.com.

This post is part of the Nepal Money Basics guide — the save-and-protect-the-family section.