Nepal Rastra Bank Allows Interest Capitalization for Long-Term Projects, Introduces 24/7 Account Freeze Mechanism
Kathmandu – Nepal Rastra Bank (NRB) has introduced new provisions allowing banks and financial institutions to capitalize interest accrued during the grace period of long-term projects. According to the revised directive, projects that require at least two years to begin generating cash flow will qualify for this facility.
The central bank said banks must develop clear internal procedures and obtain board approval before capitalizing interest. The new policy also provides relief to hydropower projects facing transmission line delays and to projects affected by natural disasters under certain conditions.
In a separate measure aimed at strengthening financial crime control, NRB has directed banks to establish a 24/7 mechanism to temporarily freeze bank accounts linked to suspected financial crimes upon request from authorized investigation or law enforcement officials. Banks are also required to respond promptly to requests for account-related information and maintain dedicated communication channels for such coordination.
The new directives are intended to support long-term investment projects while enhancing the effectiveness of financial crime prevention and investigation efforts.
Published by Nepal Rastra Bank on 2083-3-11
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