Why banks would rather park funds with the NRB than lend to business
▸ Part of: FIEUN Demands Investigation into Banker's Death, Cites Unsafe Work Environment
Nepal Rastra Bank is absorbing excess liquidity from banks due to low demand for loans, with deposits significantly exceeding outstanding loans. This situation is driven by remittances rather than domestic business profits. Despite low interest rates, businesses are hesitant to borrow due to subdued economic growth, political uncertainty, and low government capital expenditure, leading to a paradox of too much money and too little economy.
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