Government to Subsidize 2% Interest on Wage-Support Loans for Six Months

Published on September 27, 2025

To protect jobs and support businesses affected by the Gen Z Movement crisis, the Government of Nepal, in coordination with the Nepal Rastra Bank (NRB), has announced an interest subsidy program for wage-support loans. Employers who borrow to pay salaries under this facility will receive a 2% interest subsidy for the first six months, effectively lowering their borrowing cost.

The wage-support loan scheme, introduced through NRB, allows employers to access loans at base rate +0.5% premium. With the subsidy in place, the effective interest rate will drop significantly, helping crisis-hit companies retain their workers during financial stress. The loans are valid for up to one year or until the business resumes operations, whichever comes first.

This targeted relief ensures that struggling businesses can sustain payroll obligations without resorting to mass layoffs. By subsidizing interest, the government is directly contributing to job security, labor market stability, and economic recovery. Employers must apply for this scheme by Poush 2082, with priority given to industries meeting minimum employment and export standards.

Loan Restructuring for Gen Z Movement-Affected Businesses

The NRB has announced targeted loan restructuring and rescheduling measures for businesses and borrowers directly impacted by the Gen Z Movement and trade disruptions. Relief measures include restructuring by Poush 2082, concessional interest rates (base +0.5%), higher LTV for vehicles, subsidized salary loans, and export-linked incentives. These initiatives aim to revive businesses, protect jobs, and stabilize Nepal’s economy.