KATHMANDU, Jan 2: Nepal Rastra Bank (NRB) has invited applications from the business enterprises affected by COVID-19 for the refinance service offered by the central bank.  

Issuing a public notice on Friday, NRB offered the refinance scheme which it has announced through the monetary policy for the current fiscal year. As NRB had received very few applications in the first call, the central bank has again come up with a similar offer by giving a deadline of a month.

The monetary policy has earmarked around Rs 150 billion to provide refinance amount to the coronavirus-affected firms via banks and financial institutions (BFIs). After its first call, NRB had approved refinance applications for around Rs 64 billion by over 40,000 borrowers.

NRB has turned lenient this time in its criteria to apply for the refinance service. Earlier, NRB had maintained that a minimum of 70 percent of the firms should be cottage and small industries while applying for the refinance loan. The provision has now been removed.

Under refinancing loans, BFIs can issue personal loans and business loans of up to Rs 50 million at a low interest rate of up to five percent. The central bank now has given priority to those firms that fall in highly-affected and medium-affected groups to receive the refinancing loans.

Though NRB itself had been mobilizing a refinancing fund, the guideline endorsed in last July has provisioned that 70 percent resources of the refinancing fund should be mobilized through BFIs. Refinancing loans will have a maximum maturity period of one year and will not be renewed. 

Source Google News