BFIs TOLD TO INSURE DEPOSITS UP TO RS. 500,000

BSIs ASKED TO INSURE DEPOISTS UP TO Rs 500,000

Kathmandu, 21 Sept.: Banks and financial institutions (BFIs) that were required to compulsorily insure deposits up to Rs 200,000 will now need to insure all deposits up to half a million rupees, Republica reports.

Nepal Rastra Bank (NRB) on Tuesday issued a new directive, instructing BFIs to insure all deposits up to Rs 500,000. The volume of deposits for mandatory insurance coverage has been raised with sole motive of safeguarding customers´ interest, said NRB officials.

“BFIs of all categories will need to comply with the directives with immediate effect,” reads the directives.

The central bank has also asked all BFIs to slash lending rates by a percentage point for excluded and underprivileged communities in a bid to facilitate them to access loans at low rates.

Under the new directives, BFIs would now be required to provide loans to aspirant borrowers from badi, dalit and underprivileged communities along with freed bonded-labor, conflict hit, single woman, senior citizens and physically challenged persons at rates lower than the prevailing rates by 1 percentage point.

The rate cut was pushed as a part of relief programs that Prime Minister Dr Babu Ram Bhattarai unveiled last week. In the relief program, the PM had committed to provide soft loans to underprivileged groups and also assured them of improving their access to financial services.

Although direct intervention on rate by the central bank, which leaves the rates to be decided by the market, goes against its own policy, NRB Spokesperson Bhaskar Mani Gyawali said bankers were positive towards such a step, mainly as it is aimed at implementing the government´s relief program.

Likewise, the central bank has also asked the BFIs to provide loans to people operating micro-enterprises at low interest rates. It, however, has left it to the BFIs to decide on the rates at which they will prefer to work with micro-entrepreneurs.

As part of the relief program, the new directives have also asked the BFIs to provide loans to rickshaw-pullers in Tarai districts against the collateral of rickshaw itself. This scheme was first unveiled by Dr Bhattarai in his budget three years ago. It has been incorporated in the new budget as well.

Moreover, the new directive has also sought the BFIs to strictly comply with guidelines on transparency and service charges that it unveiled almost a year ago. Under this, the central bank has asked the BFIs to lower service charges, limit the interest rates gap between various saving schemes at 2 percent or less and not to levy any charges without explicitly disclosing them to customers.
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CIAA RE-ARRESTS SHIVAPUJAN YADAV

Kathmandu, 20 Sept.: The Commission for Investigation of Abuse of Authority (CIAA) on Tuesday arrested lawmaker Shivapujan Raya Yadav immediately after he was freed on bail by Kathmandu District Court, Republica reports.

The Central Investigation Bureau (CIB) of Nepal Police had arrested him on Monday on charges of misusing his diplomatic passport. Yadav had been absconding for months.

"We are also probing his alleged involvement in the red passport scam and so arrested him from the court premises," said Ishowari Paudel, spokesperson of the CIAA, adding, "Yadav is now under CIAA custody."

Kathmandu District Court had sought Rs 18,500 in bail from Yadav, who is a lawmaker from the Madhesi People´s Rights Forum (MPRF).

Judge Balkrishna Uprety had ordered Yadav´s release on bail. Subsequently, Yadav posted bail and was released only to be nabbed again instantly by a police team from the CIAA.

A team from the CIB had arrested Yadav from Chhauni, Kathmandu while he was out walking Monday evening.

Police had issued an arrest warrant for Yadav after his diplomatic passport was found being used by one Kedar Paudel in Australia. Going by immigration details provided by the Australian embassy, Paudel hasn´t returned to Nepal.

According to the Passport Act, misuse of passports can incurr up to one year in jail. If convicted, lawmaker Yadav would also lose his seat in the Constituent Assembly (CA). Yadav is the fourth lawmaker to be arrested on the same charge.

Earlier, police had arrested BP Yadav of MPRF-Republican, Gayatri Sah of Nepali Janta Party and Naradmuni Rana of CPN-UML on the same charge and cases against them are sub-judice in court. The CA membership of all three lawmakers has been suspended.
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