Kathmandu, January 26
In line with the commitment expressed by the government to relax the auto loan provision with automobile dealers lately, Finance Minister Yubaraj Khatiwada informed that the central bank has been directed to do the needful and make the auto loan provision flexible.
“We have already asked NRB to make the auto loan provision flexible and the central bank has already started working on it,” said Khatiwada at a programme in the Capital today.
Earlier this week, Nepal Automobile Dealers Association (NADA) — the umbrella body representing automobile dealers — had formally urged Finance Minister Khatiwada to relax the cap on auto loans imposed by the central bank.
In November 2018, NRB had lowered the loan-to-value ratio to 50 per cent from 65 per cent. This means that automobile buyers have to currently make a down payment of Rs 1.5 million while purchasing a car whose value is Rs three million.
The government’s decision to squeeze financing facilities in the automobile sector was basically to control the growing import of vehicles, especially luxury vehicles, in recent years.
Of late, the government is seen to be positive towards easing loans in the automobile sector as the government has failed to meet its revenue target