NRB Spokesperson: Asset-Backed Loans Discourage Project Financing
Summary
Nepal Rastra Bank spokesperson Guruprasad Poudel says Nepal’s asset-backed lending culture is discouraging project financing and innovation. He also says loan recovery challenges, rising NPL pressure and the planned Asset Management Company need clearer coordination among regulators and law enforcement.
Key Points
- Guruprasad Poudel said about 67 percent of loan disbursement in Nepal is asset-backed, which discourages project-based lending and innovation.
- He argued that banks should shift from collateral-based financing to project-based financing, especially for small and medium-sized businesses.
- Poudel said the banking sector’s Capital Adequacy Ratio remains above the regulatory minimum, while gross NPL is around 5.5–6 percent and net NPL is below 2 percent.
- He said the Government of Nepal plans to establish an Asset Management Company by the end of Poush to manage non-banking assets worth about Rs 57 billion.
