Kathmandu, Oct 26: Bank lending in Nepal crossed Rs 6 trillion by mid-September as festival shopping and import trade boosted demand for credit, Nepal Rastra Bank data show.
Banks and financial institutions increased their outstanding loans by Rs 62.85 billion, or 1.1 per cent, during the first two months of fiscal year 2026/27, reaching Rs 6.017 trillion by mid-September. Lending had grown by only Rs 35.49 billion, or 0.6 per cent, during the same period last fiscal year.
Consumer lending accounted for the largest share, reaching Rs 1.361 trillion, or 22.61 per cent of total credit. Wholesale and retail trade ranked second, with outstanding loans of Rs 1.045 trillion after increasing by Rs 25.24 billion, or 2.5 per cent, during the two months.
Loans against gold and silver rose 3.5 per cent to Rs 132.35 billion, while credit card lending increased 6.6 per cent to Rs 8.59 billion.
Santosh Koirala, president of the Nepal Bankers’ Association and chief executive officer of Machhapuchchhre Bank, said demand for credit typically rises during Dashain and Tihar as consumers spend more and traders borrow to stock goods and expand business.
Although banks have sufficient lendable funds, credit growth has remained below expectations for an extended period, he said. Floods and landslides affecting border crossings with China have also disrupted supplies, Koirala added.
Agricultural lending moved in the opposite direction, falling Rs 9.21 billion, or 2.2 per cent, to Rs 401.22 billion. Lending to crop production and agricultural services declined 3.9 per cent.
Credit to the manufacturing sector rose Rs 18.08 billion to Rs 948.41 billion. Loans to the electricity sector increased 1.9 per cent to Rs 514.1 billion, while construction lending grew 3.7 per cent to Rs 284.53 billion.
Service sector lending increased 2.7 per cent to Rs 523.46 billion. Hotel businesses accounted for Rs 234.05 billion in outstanding loans.
Meanwhile, lending to microfinance institutions fell 13.2 per cent to Rs 182.69 billion.
Himal Paudyal, spokesperson for Agricultural Development Bank, said festival spending alone would not bring a major improvement in the economy. Sustained growth would require investment in large infrastructure projects, new industries and entrepreneurship, supported by greater credit flows, he said.
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