The decline in interest rates from banks and financial institutions has boosted the attractiveness of share-backed loans. According to Nepal Rastra Bank data, investors have taken NPR 1 kharba 48 arba 68 crore in share-backed loans during the first five months of the current fiscal year. This represents a 37.74% increase compared to the same period last year, when banks and financial institutions had disbursed NPR 1 kharba 7 arba 94 crore in such loans.
Breaking down by institution type, commercial banks disbursed NPR 1 kharba 25 arba 73 crore, development banks provided NPR 19 arba 44 crore 73 lakh, and finance companies extended NPR 3 arba 50 crore 21 lakh in share-backed loans during the same period.
In comparison, during the first five months of the previous fiscal year, development banks and finance companies had disbursed NPR 17 arba 45 crore and NPR 4 arba 15 crore, respectively. This indicates a growth of 11.39% in share-backed loans by development banks and 15.75% by finance companies.
The increase highlights investorsтАЩ growing preference for using shares as collateral in a low-interest-rate environment, further emphasizing the importance of careful risk management by lending institutions.
This article was originally published on https://bajarkochirfar.com. Translated with the help of AI and reviewed by our editorial team.
