KATHMANDU, March 13: Nepal Rastra Bank (NRB) has amended the Working Capital Loan Guidance, 2079, introducing provisions that allow the rescheduling of certain working capital loans and restructuring of loans for businesses displaced by highway expansion projects.
Under the previous framework, banks and financial institutions had been providing loans with tenures ranging from three to 10 years for “procurement working capital need.” The amended guideline requires such loans to be periodic in nature, with repayment terms determined in accordance with the respective bank’s working capital policy.
NRB has also allowed existing periodic loans issued for procurement working capital to be rescheduled once by the end of Asar 2083. The rescheduling must be based on an assessment of the borrower’s cash flow and financial statements and carried out only if deemed necessary and justified. The central bank clarified that such rescheduling will not be treated as loan restructuring for the purposes of loan classification and loss provisioning.
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In addition, the central bank has revised the Integrated Directive 2082 to allow banks and financial institutions to restructure or reschedule loans extended to businesses displaced by the expansion of the Mahendra Highway and the Mid-Hill Highway.
According to the amended directive, banks may reschedule or restructure such loans upon a borrower’s request after collecting at least 10 percent of the interest due and assessing the borrower’s cash flow and income.
The directive states that the rescheduling or restructuring process must be completed by the end of Asar (i.e. mid-July), 2026. During this period, the loan classification and provisioning will remain the same as previously categorised.
