Nepal Rastra Bank (NRB) has introduced strict provisions for loans involving major shareholders of banks and financial institutions. While more lenient rules have been implemented for founder shareholders with small share ownership, stringent restrictions now apply to ordinary shareholders with significant shareholdings, even if they are not founders.

On Tuesday, NRB issued new directives, prohibiting banks and financial institutions from providing loans against assets owned by founder shareholders, directors, executives, and their family members if they hold more than 0.5% of the paid-up capital. Previously, shareholders, directors, executives, and their family members were barred from obtaining loans from the same institution, regardless of their shareholding size.

Under the new provisions, loans against property owned by shareholders and their family members holding 1% or more of the bank's shares are prohibited. To ensure compliance, NRB has mandated banks to submit details of shareholders holding more than 0.5% of the paid-up capital to the relevant supervisory department on a semi-annual basis.

In addition, NRB has set a limit on loans backed by gold and silver collateral. Banks can now lend up to Rs 5 million to a single customer against gold or silver. For existing loans exceeding this amount, the central bank has instructed banks to comply with the single customer credit limit by mid-July  2026.

According to NRB, banks and financial institutions had provided loans worth Rs 60.12 billion backed by gold and silver as of mid-August this fiscal year, a 3% increase from Rs 53.31 billion in the previous fiscal year. The rise in gold and silver prices contributed to the increase in loans, prompting NRB to impose these limits.

Additionally, NRB has stipulated that if a grace period is extended due to the completion of a hydropower project but the transmission line is still under construction, the loan will not be considered restructured or rescheduled.

Furthermore, NRB has directed banks and financial institutions to comply with the Right to Information Act, 2064. Banks must appoint information officers, keep records of requested information, and publish updates every three months, as required by the Act. Information officers are to be appointed at both provincial and branch levels.