Central Bank’s Integrated Directive: Bank rate 7.5%  

Kathmandu : Central Bank has fixed the loan interest rate (Bank rate) at 7.5 percent. Releasing Integrated Directive 2080 B.S with amendments, that the Central Bank has fixed the interest rate of loans provided to licensed banks and financial institutions i.e. bank rate at 7.5 percent.

For the implementation of the monetary policy, the Central Bank has issued a circular bank rate. Here, Bank rate is the interest rate charged while providing loans on collateral acceptable to banks and financial institutions.

Similarly, in the event that the required liquidity is not supplied from the interbank and open market and permanent liquidity facilities, then the banks and financial institutions having accounts with the Central Bank will be the lender of last resort at the prevailing bank rate for a maximum period of 6 months only.

Provision has been made to provide this facility to the cash balance, guarantee letter of the Government of Nepal or good loan collateral kept in the Central Bank to maintain the mandatory balance. The Central Bank has maintained the permanent liquidity facility rate as the upper limit of the interest rate corridor at 7.5 percent, the deposit collection rate as the lower limit at 4.5 percent and the repo rate as the policy rate at 6.5 percent.