बैंकर्स संघले राष्ट्र बैंकलाई बुझायो २२ बुँदे सुझाव, आर्थिक वृद्धिका लागि नीतिगत सुधारको मागNepal Bankers' Association Submits 22-Point Recommendation to Nepal Rastra Bank for Upcoming Monetary Policy

The Nepal Bankers' Association (NBA) has submitted a 22-point recommendation to Nepal Rastra Bank ahead of the monetary policy for fiscal year 2083/84. The proposals aim to address the sluggish economy, excess liquidity piling up in the banking system, rising non-performing loans, and the growing burden of non-banking assets.

To improve liquidity management, the association has called for the establishment of a structured secondary market for government securities, allowing banks to easily convert their investments in treasury instruments into cash whenever needed. This, the NBA argues, would make liquidity management far more efficient and responsive to market conditions.

On the issue of non-banking assets, the association has urged an amendment to the Banks and Financial Institutions Act (BAFIA) to allow banks to lease out properties acquired through loan collateral that cannot currently be sold. Additionally, the NBA has asked for a policy framework to gradually convert promoter shares of banks that have completed 10 years of operation into ordinary shares — a move it believes would boost liquidity in the capital market and provide easier exit options for investors.

Regarding interest rates and credit management, the association has proposed that base rate calculations be made more realistic by incorporating actual operating costs, debenture issuance expenses, and deposit insurance premiums. It has also recommended reducing the mandatory deprived sector lending limit from 5 percent to 3 percent, and introducing risk-based pricing that allows banks to set interest premiums based on individual borrower risk profiles. Furthermore, the NBA has suggested that banking service charges be left to open market competition rather than being subject to regulatory caps.

On non-performing loan provisioning, the association has asked for greater flexibility in line with international practices, specifically requesting a review of the current requirement that loans be kept in the same classification for three months even after becoming regular again.

To promote capital market development, the NBA has proposed that bank investments of up to 5 percent in private equity and venture capital funds not be deducted from the capital fund, and that conditions for opening overseas branches be revisited to make international expansion more feasible for Nepali banks.

In the area of foreign exchange management, the association has requested that the Non-Deliverable Forward transaction limit be raised to 40 percent of primary capital, and that a unified digital platform be developed to streamline import and export processes across all relevant government agencies.

On the digital banking front, the NBA has recommended replacing the mandatory SMS notification requirement for every transaction with recognition of in-app notifications, implementing full QR interoperability across all payment operators, and creating a shared information exchange platform between banks and police to combat digital fraud. It has also called for the swift implementation of a centralized KYC system to eliminate the burden of repeated document submission by customers, and for reducing the dormant account threshold from 10 years to 5 years with the option to close accounts digitally.

Finally, the association has proposed that expenditure by banks on financial literacy programs be counted under Corporate Social Responsibility, and that inter-bank branch consolidation and branch purchase arrangements be permitted in urban areas.

The NBA expressed confidence that implementing these recommendations would make the financial system more dynamic and help the government achieve its targeted economic growth rate of 7 percent for the coming fiscal year.