July 23: Nepal Rastra Bank (NRB) has unveiled the Refinancing Work Procedure 2077 for the renewal of loan for businesses affected by coronavirus and the subsequent lockdown imposed by the government to contain the spread of the disease.

The refinancing facility which was earlier limited to only a few industries and entrepreneurs has now been made available for small and medium scale industries.

According to NRB, the time period for the loan taken for refinancing will be a maximum of one year and this loan cannot be renewed. Only those customers who have been severely affected by coronavirus can avail such facility for up to one year. Those partially affected by the pandemic will have to clear their loan within six months. The maximum limit of refinancing facility is Rs 50 million. Small and medium scale industries can avail the loan for refinancing at 5 percent interest per annum. On the other hand, special refinancing facility can be availed at 3 percent interest rate.

The work procedure specifies loan up to Rs 1.5 million given to entrepreneurs who themselves operate their industry as small-scale loan. Likewise, the loan provided to some specific sector for some specific purpose has been categorized as special loan. Export businesses, women entrepreneurship, businesses run by differently abled persons, and loan provided to sectors affected by natural disasters have been categorized as special loan. The loan which do not fall under the above two categories have been classified as normal loan.

The work procedure is in line with the Monetary Policy for the current fiscal year, which has a provision to provide refinancing facility of up to 70 percent through commercial banks, development banks and finance companies while 10 percent refinancing facility will be provided by micro finance companies.