Kathmandu. KATHMANDU: Nepal Rastra Bank (NRB) has reduced the risk burden of small and medium enterprises (SMEs) loans.

Nepal Rastra Bank (NRB) has reduced the risk burden of SME loans up to Rs 30 million to 60 percent.

At the same time, banks and financial institutions will have to maintain 60 percent risk burden while issuing loans to agriculture, information technology and manufacturing sectors. Previously, the burden was 75 per cent.

Similarly, the Nepal Rastra Bank (NRB) has made a provision that there should be at least 25 percent difference in the market value of the real estate which is considered safe from the credit deposit and the credit guarantee fund. This is a new system. However, banks and financial institutions should mandatorily insure the projects issuing loans.

According to the NRB, the reduction in the risk burden on loans will help the banks and financial institutions to expand the loan.