Commercial banks have reduced interest rates on deposits. The Nepal Bankers Association had agreed to reduce the base rate by 1 percent. As per the same agreement of the union, the banks have reduced the interest rate on deposits.

Commercial banks have reduced interest rates on term deposits, savings and call deposits by one to one and a half percentage points. 

Banks have fixed the interest rate on one-year personal term deposits at 8.75 percent. The interest rate of institutional depositors will be 8 percent. Earlier, banks had been paying interest of up to 9.5 percent on institutional deposits. The interest rate on renewed deposits will be 8.1 percent, the association said. The bank has reduced its interest rate on savings account from 6.5 percent to 5.5 percent. Some banks have set interest rate at 5 percent.

Development banks are also reducing interest rates

Development banks have decided to reduce interest rates after commercial banks reduced interest rates. Development banks will be able to maintain a maximum interest rate of 6.5 percent on savings, a maximum of 9.25 percent on individual time deposits and a maximum of 8 percent on institutional deposits.

Banks reduced interest rates on loans

Compared to the Fiscal Year 2075/076, it has been found that the interest rate of loans has been reduced by the commercial banks during the eight months of the current Fiscal Year. In the current economic and financial situation of the country for the first eight months of the current fiscal year, the weighted average interest rate of loans is 11.80 percent. Last year, the weighted average interest rate on such loans was 12.33 percent.

According to the central bank, the weighted average interest rate on loans has decreased compared to the same period last year. According to the bank, the average base rate was 9.65 percent in February, 2075 BS, while it remained at 9.45 percent in the last fiscal year. This has also reduced the average base rate by about 0.11 percent.

The weighted average interest rate on deposits of commercial banks was 6.77 percent and the weighted average interest rate on loans was 11.80 percent in February. In the corresponding month of the previous year, the weighted average interest rate on deposits was 6.62 percent and the weighted average interest rate on loans was 12.33 percent.