Central Bank Eases Policies for Construction Entrepreneurs

Kathmandu - Nepal Rastra Bank has introduced several new measures for construction entrepreneurs. Governor Maha Prasad Adhikari announced some significant decisions for the construction sector while unveiling the monetary policy.

Here are the 6 new provisions:

(a) The repayment period for the principal and interest on loans provided to construction businesses has been extended until the end of Mangsir 2081.

(b) Construction businesses will not be blacklisted solely based on bounced checks until further notice regarding credit information.

(c) Separate provisions will be made concerning the limit for credit rating when utilizing off-balance sheet facilities among banking facilities and loans taken for construction businesses.

(d) For loans created by guarantees claimed from construction entrepreneurs, the same loan classification and loss provision will be maintained as for other loans from the date of loan creation for the fiscal year 2081/82.

(e) If any joint venture (JV) partner is blacklisted, it will not affect the banking operations of other JV partners.

(f) If the construction project period is renewed by the Government of Nepal, the guarantees provided by banks and financial institutions can also be renewed accordingly.

Governor Adhikari expressed confidence that these measures would provide relief to construction entrepreneurs. This step is expected to increase liquidity in the construction sector and strengthen business activities.