Liquidity crisis: Banks don’t entertain loan applications these days

Due to liquidity crunch, banks don't have enough funds to issue loans.
Due to liquidity crunch, banks don’t have enough funds to issue loans.

Kathmandu, February 24

With the liquidity crisis prolonged, most commercial banks in the country have halted accepting loan applications of late.

Ramesh Kumar Shrestha (named changed), a resident of Bajbajaar in Kathmandu, says Nepal Bank Limited did not accept his application for a loan worth Rs 3 million earlier this week.

Shrestha, who claims to have remained a “good debtor” of the bank in the past, shares, “The loan section chief said they are not in the condition to accept such applications. He has assured me of prioritising me once the situation eases.”

The bank’s CEO Krishna Bahadur Adhikari says his bank has halted accepting loan applications as the liquidity crisis has rendered them in a difficult position.

“You can just accept the applications, you should be able to extend loans also,” he says, “But, we have stopped it for now so that we wouldn’t keep any customer waiting.”

Officials of several other banks also say they have also done the same with loan applications.

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