Nepal Rastra Bank Cuts Directed Lending Requirement from 40% to 30%

Kathmandu — The cap on directed lending for banks and financial institutions has been reduced, allowing them to allocate only 30% of their total loans to priority sectors, down from the previous 40%. According to the revised unified directive issued by Nepal Rastra Bank, the mandatory lending to the agricultural sector has been lowered from 15% to 10%, effective from mid-January 2027 (Poush 2083). The central bank has also restructured priority sectors to include energy, tourism, information technology, MSMEs, and industries based on domestic raw materials, requiring a combined 20% lending in these areas. Banks exceeding the minimum agricultural lending threshold will be allowed to offset shortfalls in other sectors. Additionally, development banks must maintain 20% and finance companies 15% of their lending in these directed sectors.