In 1963, the Government of Nepal established the Ministry of Economic and Planning(MEP). In addition to the formulation of periodic plans, the MEP was given the responsibility of handling economic affairs of the country. The MEP was also charged with the responsibility of negotiating and concluding agreements with donors even though any formal procedures and mechanism to mobilize foreign aid in a coordinated manner were missing.

In 1968, the MEP was dissolved and a separate National Planning Commission (NPC), and the Ministry of Finance (MOF) was established. Since then, MOF has been responsible for all economic and financial affairs of the country.

The MOF is the central authority of the Government of Nepal charged with the responsibilities for maintaining both micro and macroeconomic stability in the country. Moreover, the key role of the Ministry lies with the more rational allocation of resources; better management of public expenditure; enhanced mobilization of both internal and external resources; greater performance in public investments and strengthening of public enterprises productive capacity; open and simple foreign exchange policies and regulation, and prudent fiscal and monetary policies.

Finance Minister remains at the Apex in the Ministry, whereas, bureaucratically it is headed by Finance Secretary. For practical purposes, the Ministry is further divided into the various organization - Divisions and Departments.