The NEPSE Journal
Market commentary, data deep-dives, and trading notes from the NEPSE Trading desk.
The NRB’s 2025 credit survey reveals increased funding in health and education sectors, with hospital loans up by Rs. 2.37 billion and continued investment in private schools and colleges — underscoring Nepal’s shift toward a service-driven growth model.
Electricity sector credit reached Rs. 438 billion in August 2025 — a record high — highlighting Nepal’s ongoing hydropower and infrastructure boom as banks prioritize lending toward energy projects driving future economic growth.
NRB’s August 2025 survey shows banks are diverting lending from fixed asset and real estate financing toward consumer and energy sectors, signaling a shift in Nepal’s credit structure driven by household demand and power project investments.
Construction sector loans in Nepal reached Rs. 232.8 billion in mid-August 2025, led by a strong rebound in highway and bridge projects, even as residential housing credit weakened.
Microfinance loans in Nepal have fallen by Rs. 20 billion (−10%), signaling liquidity strain, regulatory pressure, and reduced demand in rural areas. The sector faces growing stress that may challenge its traditional role in promoting financial inclusion.
Education and health loans are on the rise in FY 2025/26, reflecting stronger demand for investment in human capital and essential services, while consumer loans remain stable amid cautious household borrowing.
Nepal’s tourism credit expanded by 12.6% in August 2025, signaling renewed optimism in adventure and travel services, even as hotel loans fell 3.9% amid high costs and cautious investment. The service sector continues to grow unevenly, with tourism emerging as a key driver of post-pandemic recovery.
Wholesale and retail credit in Nepal declined by Rs. 4.8 billion (−0.5%) in August 2025, with the drop led by durable goods and small retail businesses. Despite a small uptick in automotive trade loans, overall trade credit remained weak, indicating a broader slowdown in consumer demand and import activity.
Agriculture credit in Nepal declined by 1.4% (Rs. 5.7 billion) in August 2025, mainly due to reduced financing for forest, fish farming, and allied activities. This shift underscores banks’ growing preference for industrial, construction, and service-sector lending over rural agriculture.
The latest NRB data shows that credit to transport and energy sectors grew steadily, with electricity loans up by Rs. 1.7 billion and transport loans rising modestly. This indicates that infrastructure-led financing remains a crucial pillar of Nepal’s banking system, fueling both power generation and logistics growth.