Committee of Nepal Bankers Association has Determined that Raising Kartik's Interest Rates is not Reasonable

The Working Committee of Nepal Bankers Association (NBA) has determined that raising Kartik's deposit interest is not reasonable. Banks raised Ashwin's interest rate from 11.03 percent to 12.133 percent. In Ashwin, the interest rate was raised after remaining constant for six months.

After the increase in interest, people from theFederation of Nepalese Chambers of Commerce & Industry to the Nepal Chamber of Commerce protested. After all-around protests by businessmen, Finance Minister Janardan Sharma formed a committee to study how interest can be reduced.

A report outlining the committee's recommendations to lower interest has already been submitted.

It should not be increased right away, the Bankers' Association conference on Wednesday decided after widespread objections. But no choice has been taken regarding what to do next.

The union is in "virtual" talks with the CEOs of each of the 26 banks. Every banker is free to raise or lower interest, according to a member of the group. However, it is acknowledged that maintaining the same interest will benefit everyone.

Since there has been no rise in deposits despite the interest rate increase, banks have insisted on maintaining a stable interest rate. As the deposit interest increases, the cost increases, and the base rate increases.

The interest paid on the loan rises in tandem with the base rate. As a result, the economy costs more money and there is more bad debt since older borrowers have a harder time making their payments.