One more loan gateway to commercial banks: Loans can now be undertaken in Indian currency

Nepal Rastra Bank published a notice stating that commercial banks can now take loans from Indian BFIs in Indian currency. The commercial banks are expected to follow ten major rules while seeking these loans.

Commercial banks can seek loans from India for the purpose of investing in productive sectors. However, these banks are required to be within the limit of 50% of the core capital. Only banks which have met the capital requirement as stated by NRB can use this flexibility. Such credit should be approved by the decision of the concerned bank’s board of directors. Both the giver and taker banks should have no such international allegations reported as of now. The time period of loan maturity will be 1 to5 years and can be renewed only with the approval of NRB.