BFIs reduce interest rate; businesspersons withdraw protest

KATHMANDU: Banks and financial institutions (BFIs) have decided to implement the decision to reduce the interest rate. Earlier, Nepal Bankers' Association, an umbrella organisation of commercial banks, agreed to reduce the premium rate on loans by 1% and the interest on savings by 0.4% from March 15, the BFIs informed about this through a notice on Tuesday. According to NBA President Sunil KC, now they are focused on capping the interest rates. As per the revised provisions, banks will charge a premium rate on loans up to 5% instead of 6% and will provide 6 to 8 per cent interest on normal savings. Prior to this, the bank interests on normal savings were 6.42 to 8.42 per cent.  The interest rate on fixed deposits remains unchanged at 11%. Similarly, towards institutional savings, 9% interest rate has been fixed and towards the remittance fixed deposit, it is 12%. Likewise, Development Bankers Association Nepal, an umbrella organisation of development banks, decided to reduce the interest on fixed deposits by 0.25% from March 15. As per the revised provision, commercial banks will provide 11.60% interest on fixed deposits (individual) with one or more than one-year terms and 11.50% on deposits with less than one-year tenure. Towards the institutional accounts, now development banks provide 9.60% interest on fixed deposits and 6.60 to 8.60 per cent on normal savings. Similarly, Nepal Financial Institutions Association has decided to deduct the interest on fixed savings of one-year term by 0.20% and provide 11.90%. It has decided to reduce interest on deposits with a tenure of over three months by 0.15%.

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Businesspersons withdraw protest against BFIs Meanwhile, Businesspersons who were protesting against high-interest rates of BFIs have withdrawn their protest programme. The business sector had formed the Bank and Financial Problems Struggle Committee and waging different programmes of protest for the past four days. They withdrew all the protest programs after meeting with the Prime Minister on Tuesday. Federation of Nepalese Chambers of Commerce and Industries (FNCCI) Vice President (Industry) Dinesh Shrestha shared that the business persons withdrew their protest after a discussion with Prime Minister Pushpa Kamal Dahal on Tuesday evening. Shrestha said that the government has taken the current problem seriously and the protest programme has been postponed after the Prime Minister promised to take steps to address it, including reducing the interest rates. Industrialists and businesspersons affiliated with FNCCI, Nepal Chamber of Commerce (NCC), Confederation of Nepalese Industries (CNI), Automobiles Dealers Association were protesting against high interest rates charged by the BFIs, which they said, was making it difficult to operate businesses. The protesters had been staging a sit-in at Nepal Rastra Bank since March 13. READ ALSO:

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