Kathmandu, February 15:

Though the investment climate in the country is not ‘encouraging’ due to increased conflict, bankers still see huge potentials for investment through small lending to revive business and economic activities.

Sashin Joshi, chief executive officer of NIC Bank at a press meet in the capital today said that the launching of NIC small business loan is a move to boost and support small business units.

He said that the new scheme is a simple and cost effective tool to cater to the financing needs of a wide range of small and medium business enterprises (SME s). The new scheme is bro-ught to address the need to make credit access to the needy businesspersons. Jos-hi claimed that business in such SMEs generally do not have easy access to finance and even when available, cumbersome procedures, l-engthy paper work and high cost of finance are believed to be major deterrents.

On the occasion, officials at the NIC Bank explained the features of NIC small business loan. The bank could loan from Rs 500,000 to Rs 10 million and charges interest rates minimum of 8.99 per cent per annum under the scheme. The repayment criteria have been fixed on a monthly basis over six years, according to the bank. Similarly, there is an overdraft facility, so that surplus funds can be deposited any time and withdrawn any time resulting in saving on interest and flexibility of account operations.

“A business enterprise that has posted profits for two consecutive years is eligible for the loan,” Joshi said adding that NIC bank has posted an increment in profit by 148 per cent in

the last fiscal year. During the period, the bank has registered a net profit of Rs 110 million, which is a good amount. The bank’s deposit has already reached over Rs 7 billion and lending over Rs 6 billion.”