Similarly, interest rates on savings account deposits have been set at a minimum of 5.40 percent to a maximum of 7.40 percent. Likewise, the interest rate on call deposits will be 2.7 percent.
The deposit interest rate had increased to 10.12 percent in June 2022. The interest rate on deposits kept on increasing until January this year. Since January, banks have been lowering deposit interest rates for each month except for March. With the liquidity situation easing in the past 5-6 months, banks are in a better position in terms of liquidity management. NBA CEO Anil Sharma said, “We have reduced the interest rate by one percent point in Baisakh. It is not good to reduce or change it frequently.” While deposit interest rates remain unchanged, the loan interest rate is expected to decrease. As the banks started reducing the interest rates on deposits, their expenses will also decrease. As a result, the base rate is also decreasing. On top of that, the basic rate has to be calculated every month. The banks are under pressure to reduce the spread rate to four percent by the end of Ashad (mid-July) which is currently 4.4 percent. The Nepal Rastra Bank has instructed the banks to lower the spread rate to 4.2 percent by the end of Chaitra (mid-April) and four percent by the end of Ashad. As a result, bankers say that the lending rate will decrease. “Due to the pressure to bring down the spread rate to four percent by the end of the fiscal year, there is pressure to reduce the loan interest rate. Therefore, there is no room to reduce the deposit interest rate,” Sharma further said.
