In fact, the magnificent expansion of the banking industry and the new technologies it has adopted in its services to clients is appreciable. Undoubtedly, banking industry is the most successful industry in Nepal after it opted for market-oriented liberal economic policy in 1990. But, sorry to note, some of the deposit and lending policies of banks disturbingly go against the core interest of the clients.
To site few, the practice of deducting a certain amount of money from depositors’ accounts as a penalty for failing to maintain the minimum balance set by the banks is objectionable. There are many instances where depositors found their account being written off for failing to meet minimum balance requirements. How can a bank close depositors’ account without their knowledge and slap a fine of certain amount each month when they are making some income by investing the ‘under-balanced deposits’. Doesn´t this practice contradict their much-touted policy of mobilizing small deposits?
Similarly, long-going practice of huge gap in interest rates on savings accounts offered under various names is, in fact, an act of betrayal to the loyal depositors who have been maintaining their accounts for years in a bank, despite low interests. How can it be tolerable that someone having a saving account in a bank is getting just 2.5 percent while others having similar account in the same bank is enjoying 9 percent? As the new guideline allows the banks to have a maximum of 2 percent gap, now the interest rate of those depositors, who have been at the receiving end, will be immediately doubled, at least.
The saga of borrowers is also more or less similar as many new borrowers who approach financial institutions for loans quite often tell that they were not thoroughly informed about the terms and conditions. As a result, they are forced to pay many hidden charges at the time of sanctioning loans. Against this background, the guideline that barred banks from charging other than the service charge and loans commitment charge is also a relief mainly to new borrowers. We expect more policy announcements in the days to come that we believe will not only help build people´s trust in the banking system but also make banks responsible and accountable to their clients.
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