Nepal Rastra Bank has announced a series of measures to alleviate the impact of COVID-19 on businesses and banking sector. Here are the major highlights:
- Loan installment payments postponed till mid-July 2020. Banks cannot impose penal interest or downgrade any loans for delays in repayment. If borrower pays by mid-April, then banks need to provide 10% exemption on interest.
- BFIs can extend repayment deadline of short-term working capital by 60 days. Application from tourism and transport sectors for short-term working capital needs to be processed within five days. They should not be charged feed exceeding 0.25% of the loan amount.
- Prioritization of refinancing facilities for MSMEs.
- Potential migrants who cannot go overseas for work and want to start own business, then loans extended to them by BFIs can be counted as deprived sector loan.
- CRR has been reduced by 100 bps to 3%. NRB says this will add NRS35 billion liquidity into the banking sector.