KATHMANDU, Oct 11: Nepal Rastra Bank (NRB) has asked the bank and financial institutions (BFIs) to take forward into auction the collateral assets of those borrowers only if the loan amount remains overdue for six months and more.
Revising the unified directives on Monday, the central bank has come up with the provision targeting to give respite to the borrowers who have been adversely affected by the COVID-19 pandemic. As of now, many BFIs have been taking into auction the debtors’ property even when the payment is delayed by just one month.
A few months ago too, NRB intervened in Nepal's financial market after a number of BFIs were found threatening the borrowers to make public their profiles in daily newspapers or blacklist them as loan defaulters. In the new provision, the apex monetary authority has permitted the BFIs to initiate auction only if the loans fall in ‘doubtful’ category.
Similarly, the central bank has revised the list of businesses highly affected by the pandemic. Private and residential schools, higher secondary schools, colleges and universities, vocational training institutes, preschool and child care have been included in the newly-introduced in the list.
Likewise, land transport, beauty parlors, cosmetic surgery and related businesses, consultancies and health centers and fitness centers have also been considered under a highly affected category. Earlier, NRB enlisted these businesses in medium level affected group.