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Nepal Monetary Policy 2083/84 Highlights: Key Targets & Changes

Nepal Monetary Policy 2083/84

Nepal Rastra Bank Unveils Monetary Policy FY 2083/084: Key Highlights

Nepal Rastra Bank (NRB) has officially announced its Monetary Policy for the fiscal year 2083/084. In a surprising departure from tradition, Governor Dr. Bishwanath Poudel delivered the policy in record time—wrapping up his presentation in less than four minutes.

Usually, the Governor begins by reviewing the previous fiscal year’s economic performance. This time, NRB published the annual review report beforehand. Governor Poudel concluded the brief session by stating that other officials would handle any media inquiries.

Governor : Prof. Dr. Biswo Nath Poudel

Here is a simple breakdown of the most important updates from the new monetary policy.

Major Economic Targets

The central bank has set specific goals to maintain economic stability:

  • Inflation Control: NRB aims to keep inflation capped at 5.5%.
  • Private Sector Credit: Loans to the private sector are expected to grow by 11%.
  • Money Supply: The broad money supply is projected to increase by 14%, which is a 1% drop compared to the current fiscal year.

Banking Reforms and Digital Shift

The monetary policy introduces new approaches to make banking more efficient:

  • Specialized Banking: Banks and financial institutions will be reclassified so they can offer specialized services based on the size and nature of their operations.
  • Branch Flexibility: The central bank will give banks more flexibility in opening and closing their branches.
  • Focus on Digital: By encouraging the digitalization of financial services, NRB aims to help banks cut down on operational expenses.
  • Protecting Savers: To protect depositors, the central bank plans to absorb excess liquidity so that interest rates do not fall too low.

Relief for Borrowers and Businesses

The new monetary policy also offers relief measures for the business sector:

  • Removing Unlimited Liability: NRB is tightening the rules on personal guarantees for institutional loans, eliminating the burden of unlimited liability.
  • Lenient Blacklisting: A more flexible approach will be taken, meaning fewer people will end up on the credit blacklist.
  • Help for Sick Industries: The central bank will introduce special measures to manage inactive or non-performing loans tied to struggling industries.

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