Fiscal Nepal
First Business News Portal in English from Nepal
KATHMANDU: The growth rate of credit flow in the banking sector of Nepal has been higher than that of deposit collection. The annual growth rate of credit flow has been increasing every year compared to the growth rate of deposit collection.
According to a study conducted by the Confederation of Banks and Financial Institutions (CIBFIN), the growth rate of credit flow has been higher than that of deposit collection every year since 2070 BS except for FY 2076/77.
In FY 2069/70, deposit collection increased by 17 percent, while credit flow increased by 21 percent. Similarly, when the deposit collection increased by 21 percent in the last fiscal year (FY 2077/78), the growth rate of credit flow was 28 percent.
In FY 2076/77, the growth rate of credit flow was lower than deposit collection. While deposits increased by 17 percent that year, credit flow was only 12 percent. Loan flow had shrunk during that period due to the closure led by the Covid-19 pandemic.
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