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The growth rate of private sector credit in Nepal is higher in comparison to other South Asian countries. A new report by Nepal Rastra Bank shows the average year-on-year growth rate of private sector credit in the last six years in Nepal is around 21 percent while the credit growth of India is 9 percent and that of Bangladesh and Pakistan is 13 percent. The report titled “Private Sector Credit Growth and Its Impact Upon Real Sectors in Nepalese Economy” says the growth rate of credit in Nepal was higher than its neighboring countries almost all the time, even during the period of the Covid-19 pandemic. According to the report, the growth rate of private sector credit is highly volatile in Nepal followed by Pakistan, whereas it is more or less volatile in India and Bangladesh. The report says most of the loan is collateralized by fixed assets, especially real estate. About 87 percent of the banks and financial institutions’ (BFIs) outstanding loan is backed by the asset guarantee, and the rest of 12.6 percent is backed by other collateral. Of the total credit, 75 percent of the credit is collateralized by fixed assets, and 12 percent is collateralized by current assets. As of July 2022, the highest portion of the credit is occupied by term loans; accounting for 25.4 percent followed by demand and other working capital loans with 21.5 percent. Overdraft loans and other products are also holding a significant portion of total credit having 15.4 percent and 11.9 percent respectively. “The top-most four types of credit products occupy about three-fourths share of the total outstanding loan,” says the report. More than one-fourth of the total credit portfolio falls under non-specific purpose loans (overdraft and other products). The credit portfolio of term loans and demand & working capital loans shows a quiet reversal pattern before and after the Covid-19 pandemic with a significant rise in term loans. In order to mitigate the potential damage during the Covid-19 pandemic, the NRB encouraged businesses to borrow, increased the limit of borrowing from the same collateral, and rescheduled and restructured their loans. As a result, term loans increased significantly. Since the last decade, the credit to the private sector has shifted its dynamism, and the credit to corporations has exceeded the credit to households. Since 2010, the credit to corporations is higher than the households. The gap has widened especially after 2018. This coincided with the implementation of federal structure in Nepal, and the policy of NRB to expand financial access through the establishment of at least a branch at each level. As of July 2022, almost two-thirds of the outstanding credit has been used by corporations.

The price of gold has increased by Rs 200 per tola in the domestic market on Tuesday. According to the Federation of Nepal Gold and Silver Dealers’ Association, the precious yellow metal is being traded at Rs 110, 600 per tola today. It was traded at Rs 110, 400 per tola on Monday. Meanwhile, tejabi gold is being traded at Rs 110, 050 per tola. It was traded at Rs 109, 850 per tola. Similarly, the silver is being traded at Rs 1,375 per tola today.

The Nepal Stock Exchange (NEPSE) gained 11.69 points to close at 2,129.42 points on Monday. Similarly, the sensitive index surged by 3.66 points to close at 399. 11 points. A total of 11,903,687-unit shares of 279 companies were traded for Rs 5. 31 billion. Meanwhile, Himalayan Life Insurance Limited was the top gainer today, with its price surging by 10. 00 percent. Similarly, Super Madi Hydropower Limited was the top loser as its price fell by 6.94 percent. At the end of the day, total market capitalization stood at Rs 3. 11 trillion.

The country’s major metropolitans brought their budget for the fiscal year 2023/24 on Sunday. The Kathmandu Metropolitan City (KMC) presented a budget of Rs 25.54bn, in which Rs 7.34bn has been allocated for the construction and improvement of the public infrastructure within the metropolis. The KMC budget presented by Deputy Mayor Sunita Dangol has earmarked Rs 1bn for the ‘dust-free Kathmandu’ campaign. KMC has allocated Rs 70m for solid waste management in the upcoming fiscal year. Additionally, KMC has allocated Rs 3.8bn for the Metropolis Pride Project, focusing on 10 thematic areas. And, Rs 2bn has been earmarked for 25 thematic sector schemes under the Metropolis Golden Project. Lalitpur Metropolitan City (LMC) has unveiled a Rs 6.50bn budget for the next fiscal year. Deputy Mayor Manjila Shakya who presented the budget, said that Rs 4.21bn has been allocated for capital expenditure. Bharatpur Metropolitan City has brought a budget of 6.317bn for the fiscal year 2023/24. Presenting the budget, Deputy Mayor Chitrasen Adhikari said that resources have been allocated for areas such as procurement of disaster materials, proper storage, manpower mobilization, risk reduction program, relief distribution, and rehabilitation. Biratnagar Metropolitan has made public a budget of 3.28bn for the upcoming fiscal year. The budget has allocated Rs 1.65bn for infrastructure development, Rs 852m for social development, and Rs 679.4m for the education sector. Butwal Sub-metropolitan has brought a 2.36bn budget for FY 2023/24. The budget presented by Deputy Mayor Savita Devi Aryal has given priority to social development and infrastructure.