KATHMANDU: Nepal Rastra Bank (NRB) has unveiled the third quarterly review of the monetary policy for the current fiscal year, keeping the key policy rates unchanged while announcing six new regulatory and procedural measures aimed at stabilizing the financial system and fostering investment.

The review, made public on Sunday, reflects the central bank’s decision to maintain a cautious and balanced approach amid ongoing macroeconomic challenges. NRB stated that the direction of the monetary policy has been guided by the current domestic economic and financial conditions, signaling continuity over abrupt shifts.

The policy rate remains fixed at 5.0 percent. Similarly, the deposit collection rate, which acts as the lower limit in the interest rate corridor, is maintained at 3.0 percent, while the bank rate, the upper ceiling, stays at 6.5 percent. These rates, the bank said, are aligned with its goal of supporting liquidity while containing inflation.

In addition to the rates, the existing cash reserve ratio (CRR) and statutory liquidity ratio (SLR) for banks and financial institutions have also been kept unchanged. However, the central bank has introduced a new requirement mandating financial institutions to maintain a minimum of 90 percent of the required cash reserve daily. This move is aimed at strengthening day-to-day liquidity management and improving financial discipline across the banking system.

In a move expected to ease lending restrictions, NRB has lowered the risk weight for loans backed by shares from 125 percent to 100 percent. This adjustment is likely to reduce the capital pressure on banks and encourage more credit flow into the capital market.

To further improve the investment climate, the central bank announced that it will soon issue the “Foreign Investment and Foreign Debt Management Regulations, 2078,” incorporating the latest amendments made to the Foreign Exchange (Regulation) Act, 2019, and the Foreign Investment and Technology Transfer Act, 2075 BS. These regulations are expected to streamline foreign investment procedures and improve investor confidence.

Additionally, the bank will introduce a new procedure for verifying facts related to cheque dishonor. This will be in line with the recent amendments to the Banking Offences and Punishments Act, 2064 BS, and is aimed at ensuring transparency and credibility in the banking and payment systems.

The quarterly review signals the central bank’s intent to maintain monetary stability while introducing calibrated reforms to enhance efficiency, compliance, and investor trust in Nepal’s financial system.