Nepal Microfinance Bankers Association dissatisfied with Monetary Policy

Nepal Microfinance Bankers Association has issued a press release expressing its concerns about some of the provisions in the monetary policy for the fiscal year 2077/78.

The monetary policy was publicly unveiled by NRB Governor Maha Prasad Adhikari via Nepal TV live 5 days ago on July 17.

The association states that while it welcomes the monetary policy aimed to ease the economic troubles, some provisions in the microfinance sector can potentially harm this sector. The association has thus requested Nepal Rastra Bank to sympathize with this issue and reevaluate the provisions.

The monetary policy had set the maximum interest rate on loans by microfinance companies at 15% p.a. However, Nepal Microfinance Bankers Association expresses that a provision to control the cost of the fund would have been a better solution.

Additionally, Nepal Rastra Bank had instructed microfinance companies to keep 5% of the total debt that wasn't paid back by borrowers by Ashad 2077 as a provision. The association has stated that this provisioning has posed financial harm to microfinance companies that can even obstruct operations.

The Nepal Microfinance Bankers Association has expressed its confidence that NRB will address this issue in a justified manner.