Recent Financial Crisis That Has Adversely Affected The Developed Economies Is Now Affecting The Developing World. Whereas A Number Of Studies Have Investigated The Impact Of The Crisis, The Issue Has Not Been Explored At Length In The South Asian Region. An Attempt Has Been Made In The Present Study To Explore The Impact Of The Crisis On The Economies Of The South Asian Region And To Identify The Channels Through Which It Trickled Down To The Household Level. Four Countries Of The Region I.E. Pakistan, Sri Lanka, Bangladesh And Nepal Have Been Chosen For The Study Because Of Their Similarity In Economic Conditions And Responses To The Financial Crisis. A Detailed And Rigorous Analysis Is Carried Out To Bring Forward Possible Policy Options To Mitigate The Impact Of The Crisis At The Household Level Along With The Possibility Of Replicating The Policy Initiatives At The Regional Level. The Study Also Takes Into Account The Regional Economic Cooperation Initiatives At The Saarc Level To Mitigate The Adverse Impact Of The Crisis Collectively.