NRB Nepal Monetary Policy Review Update 2082
25th February 2026, Kathmandu
The financial landscape of Nepal has entered a new phase of regulatory calibration as Nepal Rastra Bank (NRB) officially released the mid term Nepal monetary policy review update for the fiscal year 2082/83. This review is a critical instrument used by the central bank to adjust its stance based on the evolving macroeconomic indicators of the country including inflation rates, foreign exchange reserves, and credit growth. The update reflects a strategic shift from a cautious tightening phase toward a more accommodative posture aimed at stimulating economic demand and supporting the private sector. By focusing on credit ease, technological investment, and borrower relief, the central bank is attempting to bridge the gap between financial stability and the urgent need for industrial and commercial revitalisation across all seven provinces.
NRB Nepal Monetary Policy
One of the most significant changes in the Nepal monetary policy review update is the expansion of the priority sector lending framework. Historically, the central bank mandated that a specific percentage of total bank credit be directed toward agriculture and energy. However, recognizing the changing dynamics of the global and local economy, the list of priority sectors has now been expanded to include tourism, information technology, and export oriented industries that utilize domestic raw materials. This expansion is designed to diversify the economic base of Nepal. By allowing banks more flexibility in how they meet their mandatory lending targets, the central bank is encouraging the flow of capital into high growth areas like the IT sector, which has the potential to generate significant foreign currency earnings and high quality employment for the youth.
For the business community, the relaxation of the working capital loan guidelines is perhaps the most welcome aspect of this review. Previously, rigid rules regarding the reduction of loan outstanding amounts to below 10 percent for a specific period created significant liquidity stress for manufacturers and traders. The Nepal monetary policy review update has eased this requirement, allowing borrowers to maintain up to 30 percent of their outstanding balance. Furthermore, banks have been given more autonomy to determine the duration of permanent working capital loans based on the actual cash flow and financial health of the borrower rather than sticking to a one size fits all timeframe. This pragmatic adjustment is expected to improve the operational efficiency of industries and reduce the instances of technical defaults caused by short term cash flow mismatches.
The central bank has also introduced targeted relief measures for businesses disrupted by national infrastructure projects. Specifically, industries affected by the ongoing expansion of the Mahendra Highway and the Mid Hill Highway have been granted a window for loan restructuring and rescheduling. By paying just 10 percent of the accrued interest, these businesses can reorganize their debt until the end of Ashad 2083. This human centric approach to regulation acknowledges that large scale state development can sometimes have unintended negative consequences for local entrepreneurs. Such measures prevent viable businesses from collapsing due to external factors, thereby preserving the economic fabric of the regions served by these major transit corridors.
A forward looking component of the review involves the promotion of the digital economy and the facilitation of foreign direct investment in high tech sectors. The central bank has signaled its intent to support investments in data centers, cloud computing, robotics, and artificial intelligence. To achieve this, the Nepal monetary policy review update simplifies the process for the repatriation of income earned by foreign investors and allows domestic IT companies to invest limited amounts abroad for business expansion. By encouraging joint financing for large scale technology projects, the central bank is positioning Nepal as a potential hub for digital services in South Asia. This aligns with the broader Digital Nepal Framework and recognizes that the future of national prosperity lies in knowledge based industries rather than just traditional manufacturing or agriculture.
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Regarding financial discipline and the controversial issue of blacklisting, the central bank has adopted a more balanced stance. The review states that borrowers who are unable to repay loans due to genuine economic hardship rather than willful default will not be immediately blacklisted. Furthermore, for those already on the blacklist, the central bank has introduced a provision for temporary removal if the individual provides a valid justification and a clear commitment to a repayment schedule. This move is intended to bring distressed borrowers back into the formal financial system, allowing them to resume economic activities and eventually settle their debts. It reflects a shift toward a rehabilitative rather than a purely punitive approach to credit management.
Transparency and the formalization of the economy remain top priorities for Nepal Rastra Bank. The review continues to push for a cashless society by reducing the reliance on physical cheques and promoting electronic payment systems. The mandate that any payment of 5 lakh rupees or more must be made through bank accounts or account payee cheques is a clear step toward tracking high value transactions and reducing the shadow economy. To support this digital transition, the central bank has also increased loan limits for personal overdrafts to 1 crore rupees and allowed microfinance institutions to provide collateral based loans up to 15 lakh rupees. These adjustments ensure that credit remains accessible to the emerging middle class and small scale entrepreneurs who are the primary drivers of domestic consumption.
Despite these various structural and relief measures, the central bank has maintained a steady hand on the core monetary anchors. The bank rate, policy rate, and the cash reserve ratio (CRR) have remained unchanged in this review. This indicates that while the central bank is keen on supporting growth, it remains vigilant about potential inflationary pressures and the need to maintain an adequate level of liquidity within the banking system. The stability of these rates provides a predictable environment for banks to plan their interest rate structures for the second half of the fiscal year. The Nepal monetary policy review update thus achieves a delicate balance between providing the necessary stimulus for economic recovery and maintaining the long term health of the financial sector.
In conclusion, the Nepal monetary policy review update for 2082 is a comprehensive response to the current economic challenges facing the nation. By expanding the definition of priority sectors, easing the burden on borrowers, and laying the groundwork for a digital future, the central bank has provided a roadmap for sustainable growth. The success of these policies will now depend on the effective implementation by commercial banks and the responsiveness of the private sector. As Nepal moves toward the latter half of the fiscal year 2082/83, the impact of these reforms on credit flow and industrial output will be closely watched by domestic and international observers alike.
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