KATHMANDU, OCTOBER 9
Sagar Dhakal, chairman of Stock Brokers' Association of Nepal, has said the unified directives announced by Nepal Rastra Bank last week will assist in the growth of the capital market.
Stating that the consolidated directive has increased limit of Rs 120 million for margin loans, Dhakal remarked that the problem of investors has been heard and understood to some extent amid a programme held today.
"As there is an inter-link between the stock market and the real estate business in Nepal, the policy of the central bank to increase the limit of margin loans will help to make the overall economy sustainable," he opined.
Similarly, the central bank has made arrangements for the difference between the interest rates of the same nature of loans to be not more than two percentage points. "This will decrease interest rates on loans in the coming days, providing relief to investors of the stock market. The said policy will also reduce interest on loans flowing into the stock market in the coming days, so instead of calling out the regulator for capital market reforms, we have to move forward with positive thinking, which can assist in the market development and growth," Dhakal added.
Earlier, banks were charging difference of up to five percentage points in interest of similar loans.
Similarly, he argued that there is no alternative to the development and expansion of the capital market as it provides easy access for long-term management of the capital required for the operation of small start-ups, from the construction of large-scale infrastructure by attracting domestic and foreign capital as more than 5.9 million Nepalis are associated with the market. Dhakal also called for the need to bring policies related to intra-day trading, developing the bond market, and margin trading alongside real-time settlement of funds.
A version of this article appears in the print on October 10, 2023, of The Himalayan Times
