Reference Interest Rate Of Cooperatives Fixed At 16 Percent
February 27, 2022 | Investopaper
The Department of Cooperatives has fixed the reference interest rate at 16 percent on Friday. The interest rate has been fixed with effect from Falgun 15, 2078 BS. Earlier, the reference interest rate for savings and loan cooperatives was 14.75 percent.
Article 51 of the Cooperatives Act 2074 and Article 23 of the Cooperatives Rules 2075 have made provision for reference interest rate. The department reviews the reference interest rate every year.
Similarly, the difference between the interest rates on loans and savings should not be more than 6 percent. Now, if the cooperative imposes a maximum interest rate of 16 percent on the loan, the interest rate on the savings should not be less than 10 percent.
Due to the lack of liquidity, the banks have been raising interest rates, while the cooperatives have been demanding 18 percent reference rate. Cooperatives were also forced to raise interest rates on savings as interest rates offered by banks increased.
