Loan repayment deadline extended for flood-affected entrepreneurs

Kathmandu, Oct. 14: The Nepal Rastra Bank (NRB) has directed the banks and financial institutions (BFIs) to extend the deadline of installment payment for the entrepreneurs affected by the Bhotekoshi and Budhigandaki floods to mid-January 2027. 

Amending its integrated directives, the central bank added a new clause mandating the BFIs to extend the deadline of loan repayment for flood-affected borrowers by three months, from mid-October 2026 to mid-January 2027. 

As per the circulars published on Tuesday, this provision is for enterprises, projects or businesses directly affected by floods in the Bhotekoshi and Budhigandaki river areas, businesses dependent on the import or export of raw materials, semi-finished goods and finished goods through the Rasuwa Customs Point, and borrowers affected in the flood-hit areas. 

"The BFIs may extend the deadline for instalment payments (principal and/or interest) falling due by mid-October 2026 to mid-January 2027, where borrowers face difficulties in making payments," said the NRB. 

However, it mandated the BFIs to mandatorily conduct a realistic assessment of the borrowers’ financial position, including sales and income, cash flow and reserve funds, the impact on imports and exports, and the actual utilisation of loans before granting the extension for the loan repayment.