Nepal Rastra Bank Issued Integrated Directive to Bank and Financial Institutions:
The Nepal Rastra Bank (NRB) has instructed the concerned bodies to extend the time without taking any additional penalty on the loans and interest taken by all professions, industries, and businesses due to the steps taken for the control and prevention of COVID-19.
As per the integrated guideline issued by the National Bank last year with the aim of implementing the monetary policy for the current Fiscal Year 2077/78, the corona-affected entrepreneurs have been given extra time without any additional penalty, interest and fee and penalty and interest. Banks and financial institutions have been instructed to do so.
The directive issued by the National Bank of Nepal (NBN) to Class A, B, and C institutions has directed to extend the time without any additional penalty on the principal and interest amount of the loan disbursed to the least affected, medium affected and severely affected areas.
NRB has earlier categorized the industrialists and businessmen affected by the corona in different stages and extended the period for paying interest on the loan.
Based on the study of the impact of the Corona epidemic on the economy and its impact on the financial sector and the time it takes to revive the industry, the affected areas have been classified into three categories: low-affected, moderately-affected and over-affected.
The NRB has directed to repay the installment and interest amount of the active loan from Corona to the least affected area by the end of Ashad 2077 and the interest amount by the end of Poush 2077. Similarly, to repay the installment and interest amount of the active loan in the moderately affected area by the end of Ashad 2077 and to pay the installment and interest amount of the active loan in the most affected area by the end of Ashad 2077. There is an arrangement to pay by Ashad 2078.
It will take time to rehabilitate the most affected industries and businesses including the tourism sector. By the end of Ashad 2077, up to two years will be provided for the repayment of the principal and interest amount to be repaid.
15 percent investment in agriculture is mandatory:
NRB has directed to invest 15 percent of the total loan in agriculture. With the aim of increasing investment in agriculture, developing and expanding agri-enterprises with the aim of making agriculture self-reliant, the NRB has made agriculture a priority sector for credit and has also made provision for 10 percent investment in the energy sector.
The NRB has placed agriculture as a priority sector of credit with the aim of involving those who have returned from foreign employment in the agricultural sector, increasing investment with the aim of making them self-reliant in agriculture, and developing and expanding agri-enterprises.
The directive also states that banks and financial institutions should give special priority to the agricultural sector for the next three years.
Service fee within 0.75 percent:
As per the directive, commercial banks have to charge service fees within 0.75 percent. Debtors are now required to pay a maximum of 0.75 percent service fee when taking a loan. Earlier, commercial banks had been charging more than one percent service fee.
The NRB has directed the commercial banks not to charge more than 0.75 percent, development banks one percent, finance companies 1.25 percent, and microfinance more than 0.50 percent.
Up to 60 percent loan on the house and land collateral:
NRB has directed to provide loans up to 60 percent for the construction of houses approved by the Government of Nepal. The NRB has directed all banks and financial institutions to provide loans up to 60 percent on real estate collateral.
According to the directive issued by NRB, the ratio between the fair market value of real estate loan and its collateral security within the Kathmandu Valley should be maintained at a maximum of 40 percent and in other places up to a maximum of 50 percent.
The directive stipulates that a maximum of 60 percent can be maintained in the case of a loan provided for a house construction business company approved by the Government of Nepal, which is registered and operating in accordance with the rules.
Loan up to 70 percent on share pledge:
As per the directive of NRB, it is possible to take a loan up to 70 percent by pledging the shares of any company.
As per the integrated guideline of NRB, provision has been made to give the loan on the basis of the last price of 180 days on the basis of the last price of 120 days. Similarly, provision has been made to give share loans only up to a maximum of Rs 5 million per customer.
परिपत्र नं. १ (क,ख,ग):आर्थिक वर्ष २०७७/७८ को मौद्रिक नीति संग सम्बन्धित तथा अन्य
परिपत्र नं. १ (घ): आर्थिक वर्ष २०७७/७८ को मौद्रिक नीतिसंग सम्बन्धित तथा अन्य
