Kathmandu. The flow of loans from banks and financial institutions to the private sector has increased. According to the data of Nepal Rastra Bank, credit to the private sector has increased by 4.4 percent till mid-March. This is lower than the 6 percent growth in the same period last year.
It has made it clear that although there are enough resources in the bank, it has not been used as expected.
Loans to the private sector increased by 4.6 percent for commercial banks, 3.5 percent for development banks and 1.9 percent for finance companies. Currently, the investment made by banks and financial institutions in the private sector has reached Rs 5.741 trillion.
In the current fiscal year 2082/83, the total loan has crossed Rs 5.7 trillion with the expansion of loans of more than Rs 243 billion. Deposits increased by 6.6 percent to over Rs 7.7 trillion in the same period. This is a higher growth rate than the previous year.
The rapid growth in deposits has further eased liquidity in banks and has a direct impact on interest rates. As of mid-March, the weighted average interest rate of commercial banks has come down to about 6.90 percent. It was 8.40 percent in the previous year.
The central bank data shows that the interest rate on deposits has also decreased significantly.
