December 21: After strong warning from the central bank, the commercial banks of Nepal have agreed to keep the interest rates on deposits below 10 percent.

Breaching the previous agreement to keep the interest rate as per the regulations of the central bank, the commercial banks had started to increase the rates to attract deposits.

Organizing a meeting in the capital on Thursday with the chief executive officers (CEOs) of the commercial banks, the Nepal Rastra Bank had instructed the banks not to compete on interest rates to attract deposits.

According to the representatives of the development banks, the competition of raising interest rates on deposits has created problems for the development banks. It was said that the increase in the interest rates has had negative impacts on the capital market and the whole economy of the country.

In a separate meeting with the Nepal Bankers’ Association (NBA) on Thursday, the CEOs of 28 commercial banks agreed to lower the interest rate below 10 percent.