Kathmandu. Former Vice-Chairman of the National Planning Commission Dr Min Bahadur Shrestha has pointed out the need to give license to run state-level banks. Shrestha said this at a meeting of the Finance Committee under the House of Representatives.

He suggested that there is no need to give license to the central level private banks, but the state-level banks should be given licenses. “The old banks also improved after giving licenses to private sector banks. A new bank should be given a license to fulfill the prescribed objective,” he said. ’

He suggested that the provinces should be allowed to open the bank so that the agriculture development bank and THE NIDC would do the same work together. Shrestha recalled that the first Lumbini province wanted to open a province-level bank and the Rastra Bank did not give a good signal at that time.

Similarly, Bagmati Province has also planned to open a state-level bank. He suggested that rastra bank should not only give license while opening a state-level bank, but also help by being proactive. Shrestha suggested that the province should also be included in the amendment to the Bank and Financial Institutions Act (BAFIA).

At the meeting, Shrestha suggested merging microfinance institutions with commercial banks and operating them as a separate ‘wing’. He said that if we leave the present situation, we will have to face a lot of challenges in the future.

“In the past, microfinance was needed, roads and communication facilities were not available.

Now, there is access to roads and communication by leaving the limited space,” he said, adding, “The alternative to solve the problem of microfinance can be made by merging the commercial banks and providing microfinance financial services separately.” Running microfinance in the current way can be a big challenge. He suggested that timely attention should be paid to this.