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Directive No. 15 ( Interest Rate)

1. The difference between the interest rates provided under different saving schemes should not be more than 2%. However,
rate for Saving Accountant. Incase of any changes in the interest rate provided in saving product, changes should be made con

2. The interest rate provided in the call deposit should not be exceeding the minimum interest provided in the saving product.
increase the interest rate for deposits other than call deposit up to a point of 0.5 percent over the published rate. But

a) Interest rate may be fixed on the agreement between bank or financial institution and customer in the case of perpetual fun
b) In case of the institutional deposit to be collected on the basis of bidding applicable interest rate may be 1% over or below
changed upto a period of 3 months.

3. The institution can not accept the deposit for fixed deposit account which can be payable at demand.
4. The interest in saving accounts shoukd be provided even if the account gets dormant by any reason.

(4) While determining the interest rate for loans and borrowing , the average difference between the interest rate provided by
borrowing shall not be more than 5 %. Following are the provision for calculating the average interest rate
(i) Average interest rate should be calculated by using the formula as mentioned in Annexure 15.2 and the such interest rate
quarterly prepared financial statement and the statement regarding interest rate , averegae interest rate difference should als

(ii) Thus published statement of average interest rate difference should be submitted as per the format given in Annexure 15
supervision division and Investigation department.

Base Rate
Base Rate should be determined as per the base rate determination prescribed in annexure 15.1 of the PROCEDURE FOR DET
15 days of the end of the month. The same base rate should be published in its website.

Loan Interest

(1) 4. While determining the interest rate for loans and borrowing, it should be determine on the basis of Base Rate. And resch
of Base Rate.

(2) while determine the interest rate on loans and borrowing on the basis of base rate, the premium rate added to the base ra
4%).
(3) While publishing the interest rate the premium rate that is added to the base rate should also be published.

(4) Following are the provision regarding the base rate:

(a) The licensed institutions shall compulsorily furnish the statements of interest rates on
deposits and lending to Banks and Financial Institutions Regulation Department and the
concerned Supervision Department of this Bank within 15 days of the end of each month. (Annexure 15.1)
(b) Adjustment to the interest rate should be made, equal to change in base rate. Adjustment to the interest rate should be m
the interest rate, the adjustment should be done as per the agreement.

(5) Following are the provision regarding the premium rate:

(a) Based on the type and terms of loan and borrowing different premium rate should be determined. And the interest rate s
this interest rate the premium rate should also be adjusted.
(b) While providing the loan the decision should be taken regarding the premium rate and such premium rate should be menti
premium rate such premium rate should not be greater than the premium rate as mentioned in loan application.

(c ) After taking the decision regarding the premium rate and after mentioning it in the offer letter and such premium rate sho
fails to pay the principal and interst amount in time, if the loans taken by the borrower is not used for the said objective , if do
comply with the terms and conditions as mentioned in the offer letter the penalty rate may be greater than the rate as menti
(d) In case of additional loans and borrowing taken by the borrower or in case of the new loans and borrowing provided by th
applicable.

(e) If the bank and financial institution has provided the loans and borrowing without taking the decision regarding the premiu
rate as mentioned in the offer letter and the base interest rate as at the date of providing loans and borrowing.
(f) While determining the interest rate on loans and borrowing and the premium rate that is added to the base rate should be
directive.

(6) Bank and financial should give at least 1% concession on the interest rate of the Deprived Sector Loan while providing loa
Donda Pidit, Yakal Mahila and to the Differently able people as per the Directive 17.

3. Other provision regarding the interest rate

(1) In situation where interest on credit/lending by banks and financial institutions on a quarterly basis, interest shall be credit
Interest to be provided to depositors shall be provided at least on average deposit balance of week, month, quarter or other d
the policy of the concerned bank and financial institution to provide interest on deposit liability. Note: Average deposit balnce
daily transaction.For example , the procedurs according to which licensed bank and financial institutions use to have calculate
procedures shall be applied in the calculation of the interest.

(2) Interest accruals on the loans and advances shall be recognized as income on the cash basis only. The interest accrued but
the account shall be reconciled accordingly. Interest receivable for a period shall be debited to Interest Receivable Account an

(3) Bank and financial institution shall publish at the time of each amendment made on interest rates on deposit and on lendin
amendment on the interest rate , such interest rate should be published on quarterly basis. The National Level bank and finan
district level institutions shall publish the particulars of changes in the requirement of about the minimum level of balance to b

(4) The licensed institutions shall compulsorily furnish the statements of interest rates on deposits and lending to Bank and Fin
and department of this bank within 7 days of the end of each quarter. Moreover, the licensed institutions shall submit all the p
the implementation and changes made thereto within 7 days.
4. Penalty for non compliance to provision regarding the interest rates
If the bank and financial institution fails to comply with the provision relating to the interest rate such licensed institution shal

5. Repeal and saving

(1) The following directive issued by the Bank has been repealed - Provisions relating to interests rates in the Unified Directiv
until 2074 Shrawn 9.
(2) Actions taken under the Directives repealed pursuant to sub-clause (1) shall be deemed to have taken under these Directiv

Procedure to calculate the base rate(2069)

2. Base rate = % of(cost of Fund+ cost of CRR + Cost of statutory Liquidity + Cost of operating expenses + Return on Assets)

2.1 Cost of fund= Weighted average interest rate of national deposit and loans and borrowing

2.2 Cost of CRR= (Average cost of Fund * Average amount of CRR)/ Average amount of deployable fund

2.3 Cost of statutory Liquidity =Gross Amount Statutory Liquidity (Cost of Fund- Weighted average interest rate of Govt. Se

Gross amount of Statutory Liquidity= Average amount of Statutory Liquidity- Average amount of CRR

2.4 Cost of operating expenses=Total operating expenses* 85/Average amount of deployable Fund

2.5 Return on Assets=0.75%

Average amount of Deployable Fund= Average amount of National Deposit +Average amount of national loans and borrowi

3. Other aditional conditions for calculation of Base interest rate

3.1 Base rate should be calculated based on financial and statistical details of last period. Annual expenses that are not av
proportionate basis.

3.2 While calculating the Average amount of statutory liquidity and the average amount of CRR , minimum amount should
3. 3 While calculating the total operating expenses the staff expenses and other operating expenses should be considered a

Circulars about the Directive no. 15

If the average interest rate differnence is more than 5% after 2075 Aswin ends in case of licensed institution of class A, B and C
punishment:
1. Bank is not allowed to open new branch in the local level in which there is no branch.
2. Bank is not allowed to provide new loan facility to the person other than earthquake victim.
3. Bank is not allowed to declare and distribute the cash dividend.
To calculate Average interest rate difference(Spread) consider the formula as mentioned in the Annexure no.15. 2 of N