Loan Interests Slashed By 1.5% Effective From Jestha 1 After NRB's Amendments; Debitors to Get Relief

Following the directive of the Nepal Rastra Bank (NRB) allowing to adjust loan interests on a monthly basis, customers will get relief as they will not have to wait until Shrawan 1 to pay reduced loan interests.

Based on the earlier regulation set by the central bank, although interest rates on saving deposits could be fluctuated monthly, loan interests could only be revised once in each three month quarter.

In line with the previous provisions, despite reduction in interests on saving deposits and subsequent reduction in bank investments, debitors were not able to get relief. However, acknowledging the same, Federation of Nepalese Chambers of Commerce and Industry (FNCCI) Banker's Association had been calling for amendments.

Adressing the demand, NRB has now made arrangements for monthly adjustments in base rates. Subsequently, loan interest rates are likely to decrease as well.

At most, banks can now slash interest loan rates by 1.5 %. As premium customers hold great negotiation ability, they can now get loans at single-digit interest rates at banks with lower base rates.