Kathmandu. KATHMANDU: Nepal Rastra Bank (NRB) has amended the ‘D’ class microfinance institution directive-2082 BS. KATHMANDU: Nepal Rastra Bank (NRB) has revised the provisions relating to merger and acquisition process between wholesale lending providers and microfinance institutions.

According to the circular issued by the Rastra Bank, the amendment has been made to sub-point (5) of clause (e) of point number 4 of Directive No. 17÷082.

As per the amended provision, a microfinance institution carrying out retail business should operate only as a microfinance institution doing retail business if a microfinance institution and a microfinance institution carrying out retail business are merged with each other or participate in the acquisition process and conduct integrated transactions.

However, after the merger or acquisition process, the bank has given exemption for the transaction of wholesale loans for five years from the date of operation of the integrated transaction.

Earlier, the existing provision had mentioned that such institutions could operate as microfinance institutions conducting retail business, but the wholesale lending institutions could recover the loans issued before the merger as per the existing payment schedule.