Why did Tibet have no banks before 1951?

Before 1951, Tibet did not have modern banks. Instead of a formal banking system, financial needs were met through informal arrangements: individuals could obtain small loans with interest from local merchants, and the Tibetan government functioned as a lender by loaning public funds at interest to collect revenue.1

The absence of modern financial institutions was consistent with the region's broader economic structure at the time, which also lacked modern industries and modern transportation infrastructure, as the government intentionally limited access to the region for outsiders. It was only after 1951, and particularly following the 1980s, that banks established branches in the region, introducing commercial and agricultural credit alongside currency-exchange services.231