KTM2DAY.com
KATHMANDU TODAY

NRB bans service charge on deposits

Nepal Rastra Bank (NRB) has forbidden banks and financial institutions (BFIs) from taking any kind of service charge on deposits following complaints from depositors that their small savings are been reduced.

An NRB circular issued on Monday stated that BFIs cannot take any service charge for operating deposit accounts.

NRB spokesperson Bhaskarmani Gnawali said that the central bank had to take such a move after it received information that some BFIs were charging fees in the name of account maintenance.

Likewise, the central bank has told BFIs to establish a separate desk under their credit department to deal with “sick industries”. Gnawali said that NRB had brought this provision with the aim of managing the records of such industries, monitoring them better and finding alternatives to support them. “Establishing such a desk will help BFIs to get refinancing facilities while extending loans to such industries,” he added.

Although the central bank has been providing refinancing to help sick industries to recover, these measures have hardly helped them to recover.

The central bank has also allowed finance companies to purchase foreign exchange and sell it to the central bank through their branches in 30 districts having a small banking presence. They have not been provided this facility in other areas. Only commercial banks and finance companies have been allowed to conduct such transactions at the moment.

NRB’s move follows requests by finance companies that they be allowed to collect foreign currency from their branches in tourist hubs. “This provision will facilitate tourism as tourists visiting remote parts of the country will be able to exchange foreign currency wherever there is a finance company,” said Gnawali.

The Nepal Finance Companies Association (NFCA) had written to NRB asking for its go-ahead about a month and a half ago. NFCA president Rajendra Man Shakya welcomed the central bank’s circular and said that this authorization would help FIs to diversify their earnings to some extent.

Similarly, the central bank has allowed BFIs to treat long-term debts with a maturity period of five years or more and have lent them as deposits while calculating the credit-to-deposit ratio.

NRB has also permitted BFIs to accept loans and grants in local currency from foreign organisations having a branch office or project in Nepal after getting its approval. However, their liabilities should not be in foreign currency while accepting such loans.

Gnawali said that this circular had been issued considering the convenience of micro finance institutions that may receive funds from foreign donors.(Source:ekantipur)

Related Post

Hotels to accept foreign currency payments The central bank has permitted hotels to accept payments made by guests in foreign currency. The foreign exchange buying rate of the day fixed by h...
Nepal Rastra Bank to introduce National Payment System The interoperability between bank accounts might become a reality in the near future as the central bank is mulling a strategy to launch National Pa...
Loan in Foreign currency permitted to certain businesses Nepal Rastra Bank (NRB), on Friday, announced a new provision wherein tourism businesses, export-oriented industries and hospitals are permitted t...
Foreign Banks get green signal from NRB Nepal Rastra Bank, the central bank, has introduced a policy to allow foreign bank and financial institutions to open their branches in Nepal. The ...
Citi’s exit from Nepal opens door for other banks The US-based Citi Bank’s decision to discontinue all banking relations with Nepal has opened door for other international banks to expand their busi...
The World Bank grants $100 million loan for Nepal’s energy sector The World Bank has approved $100 million under the Nepal Energy Sector Development Policy Credit programme, which aims to implement key policies a...
NRB relaxes money exchange rule The central bank has continued to give further relaxation on foreign exchange management in line with this year’s monetary policy. The Foreign Exch...
Nepal Rastra Bank issues blind friendly banknotes Nepal Rastra Bank has issued Rs100 denomination banknotes with a feature which allows visually impaired people to recognize them. This is the first ...
Foreign exchange reserve swells to record high With the swelling foreign exchange reserves, the richer Nepal can afford to buy more merchandise from abroad to feed its growing consumerism. The f...
The World Bank shows interest in hydro The World Bank has shown interest to invest in hydropower and transmission line development. During a meeting with the finance minister Barsha Man ...
US Dollar strengthens furthermore against the Rupee Nepali rupee has fallen to a fresh 28-month low against the US dollar, as the value of the Indian rupee, with which the country’s currency is pegged...
Nepal still under FATF scanner Nepal is still under strict scrutiny of global anti-money laundering (AML) body. International Cooperation Review Group (ICRG), an analysis wing of...
Forex NEPAL RASTRA BANK Exchange Rate for 18 January 2019 Exchange Rates Fixed by Nepal Rastra Bank Currency Unit Buying/Rs. Selling/Rs. ...
Dollar at 11-month low of Rs 94.37 The Nepali rupee rode to an 11-month high against the US dollar on the back of a strong Indian currency following the optimistic Indian election res...
38 percent Nepalis has bank accounts A total of 38 percent of the country’s population now has bank accounts, up from 26 percent in 2006, the latest Nepal Rastra Bank (NRB) statistics h...
Banking in Nepal: Exciting Times Ahead It is apparent that Nepali banking space is crowded with 32 Commercial Banks, 88 Development Banks, 70 Finance Companies and several cooperatives un...
Pay your bills online with eSewa F1Soft International Private Limited launched eSewa, the first inland e-shopping and payment service, here today. The service -eSewa.com.np -- will...