Nepal Rastra Bank Lowers Risk Weight for Loans Under NPR 30 Million

The Nepal Rastra Bank (NRB) has announced a reduction in the risk weight for loans under NPR 30 million, aiming to encourage lending and improve liquidity in Nepal’s banking sector. The move is expected to benefit small and medium-sized enterprises as well as individual borrowers.

Implications for Banks and Borrowers

With lower risk weights, banks can allocate more capital toward lending, potentially increasing loan availability and reducing borrowing costs. Financial analysts note that this step may stimulate economic activity, support business growth, and improve access to credit for underserved sectors.

Strengthening Financial Sector Stability

NRB officials emphasized that the decision balances risk management with the need to support economic development. The policy adjustment aligns with broader efforts to enhance financial stability, ensure efficient credit flow, and promote sustainable growth in Nepal’s banking and finance sector.