March 8, 2021 | Investopaper
Nepal Rastra Bank has made a provision for a special refinancing facility for hydropower projects with a capacity of less than 10 MW. NRB has made such a provision by making the first amendment in the refinancing procedure 2077 BS.
Such hydropower projects will get loans from banks and financial institutions at an interest rate of 3 percent. NRB will charge a 1 percent interest rate with banks. Such hydropower companies will also be able to get a maximum of Rs 20 crores. In the half-yearly review of the monetary policy, the central had mentioned that it has made a provision to get an easy loan for hydropower up to 10 MW.
The lump-sum refinance provided to banks by NRB has been limited to 70 percent of the total fund amount. The recipient gets such a loan up to a maximum of Rs 5 crores. The special or general refinancing limit for individual customers is set at Rs 20 crores per customer. Such loans can be floated up to 20 percent of the total amount in the fund. Refinancing through ‘D’ class institutions can be provided up to 10 percent of the total fund.
So far, NRB has approved refinancing worth Rs 142 Arba. Under the lump sum, loans of Rs 92 Arba have been sanctioned for banks and financial institutions (excluding microfinance). Similarly, loans of Rs 39.50 Arba is approved under special or general refinancing, and Rs 10 Arba for microfinance institutions.