Kathmandu. Deposits of commercial banks have decreased by 1 trillion 15 billion rupees in about a month.  According to the Nepal Bankers Association, the total deposits of commercial banks have decreased to 44 trillion 26 billion rupees as of the end of June last year.

According to the statistics of Nepal Rastra Bank, as of August 6, there are deposits of 44 trillion 25 billion rupees in commercial banks. According to the statistics of the National Bank, deposits have decreased by about 2 billion rupees every day.

Banks have not used methods to attract depositors even though deposits are continuously decreasing. It is a banking practice that banks increase interest rates to attract depositors.

Anil Upadhyay, President of Nepal Bankers Association said that bankers are not in favor of increasing the interest rate of deposits as there is no basis to increase the interest rate even if the interest rate is increased. The meeting of the Bankers Association held in the last week of July has also decided not to increase the deposit interest rate.

The argument of bankers is that when the interest rate of deposits increases, the interest rate of loans will also increase and this will increase the cost of production, increase in prices, decrease in production, and adversely affect the overall economy. In the current situation, bankers are unanimous in keeping the interest rate stable.

On the other hand, the National Bank is in favor of increasing the deposit interest rate. A year ago, when banks suddenly started increasing interest rates at high rates, the National Bank issued an instruction not to increase or decrease interest rates by more than 10 percent in 3 months.

After the issuance of the directive, the banks have increased the interest rate on loans, but they have not increased the interest rate on deposits. The Rashtra Bank is of the view that there is no option but to increase interest rates in the absence of resources. Rastra Bank Governor Mahaprasad Adhikari had already said publicly that all parties should be prepared for the increase in interest rates when there is a shortage of resources.