राष्ट्र बैंकको एकीकृत निर्देशन संशोधन, कालोसूची र शाखा व्यवस्थापनमा लचकताNepal Rastra Bank Revises Unified Directive, Eases Blacklisting and Branch Merger Rules

Kathmandu — Nepal Rastra Bank (NRB) has issued a revised and amended Unified Directive–2081, introducing significant changes in loan recovery procedures, blacklisting rules, and branch management for banks and financial institutions. The new directive was issued on Monday by Ramu Poudel, Executive Director of the Bank and Financial Institutions Regulation Department.

The revised directive aims to make banking regulations more practical and flexible, particularly in response to economic slowdown, rising non-performing loans, and the growing role of digital banking.

Collateral Can Be Acquired Only After Three Failed Auctions

Under the new provision, banks and financial institutions are now allowed to acquire non-banking assets (collateral) only after completing at least three auction attempts if the collateral fails to sell. Earlier, banks were required to acquire the collateral themselves when auction attempts were unsuccessful during loan recovery.

NRB stated that this change is intended to ensure that banks prioritize loan recovery over asset acquisition, preventing premature booking of non-banking assets.

Borrowers Removed from Blacklist After Full Recovery Through Collateral

A key reform in the directive allows borrowers to be removed from the blacklist if the bank fully recovers its outstanding dues by acquiring collateral equal to the loan amount. However, the borrower must provide a written commitment relinquishing all ownership claims over the collateral.

According to NRB, this provision is meant to support borrowers who defaulted due to situational or economic difficulties rather than willful intent, allowing them to re-enter the financial system after settlement.

Mistaken Blacklisting Can Be Reversed by CEO Decision

The revised directive also simplifies the process of removing borrowers who were mistakenly blacklisted. Previously, removal required a recommendation from the bank’s board of directors. Under the new rule, a decision by the bank’s Chief Executive Officer (CEO) will be sufficient to request immediate removal from the blacklist.

NRB has clarified that individuals or entities removed under this provision will not be considered blacklisted, though banks must report such cases to their boards on a quarterly basis to maintain internal accountability.

The directive also allows blacklisted individuals to open salary accounts, ensuring access to basic financial services.

Background: Rising Blacklist Numbers

NRB Governor Dr. Bishwanath Paudel has repeatedly expressed concern over the growing number of borrowers on the blacklist, stating that excessive blacklisting has weakened overall credit demand.
According to NRB estimates, around 150,000 individuals are currently blacklisted.

The governor has emphasized that recent economic stress and business slowdowns have pushed many borrowers into default due to circumstances rather than misconduct, prompting the central bank to adopt a more facilitative approach.

Banks Allowed to Merge Branches Within Metropolitan Areas

The revised directive also allows banks and financial institutions to merge branch offices within metropolitan cities without prior approval from NRB. This flexibility has been introduced in response to the rapid expansion of digital banking services and the declining necessity of physical branches.

However, NRB has set conditions for such mergers. Branches established to serve government or public institutions may be merged only with written consent from the concerned entity.

Mandatory Public Notice Before Branch Merger

Before merging branches, banks must issue a minimum 90-day public notice through a national daily newspaper, the bank’s official website, and the notice board of the affected branch.

If two or more branches are merged, customers must be allowed to repay loans or discontinue services without any fees, ensuring consumer protection during the transition.

The directive defines branch adjustment as the merger of two or more branches into a single operational unit.

Policy Shift Reflects Changing Banking Landscape

NRB has acknowledged that banks aggressively expanded branch networks in the past to increase market presence. However, with the growth of digital transactions and electronic payment systems, many branches have become operationally inefficient and financially burdensome.

In line with this shift, NRB has also withdrawn its earlier policy requiring commercial bank branches in all 753 local governments, noting that nationwide banking access has already been achieved.

The revised Unified Directive signals NRB’s effort to balance financial discipline with economic realism. While the changes provide relief to borrowers and operational flexibility to banks, NRB has indicated that regulatory monitoring will remain strict to prevent misuse.

Analysts believe the reforms could help revive credit demand and improve banking efficiency, provided risk management standards are carefully enforced.