NRB brought Cap on Call Deposit!

As per NRB new circular issued as on 24th may 2019...an "A" class bank can't accept deposit on call account more than 10% of their total deposit liability, like wise B class bank can accept deposit from call account only upto 15% of their total deposit liability. NRB relaxation up to ashad 2077 BS, to maintain the above ratio. 

Before this amendment Banks were allowed to accept deposit from call account up to 25% to their total deposit liability. 

What is Call Deposit Account ?

Call Account is a flexible interest bearing saving account that requires you to maintain a certain amount of deposit to earn you a pre-negotiated interest. Call Account also gives you the flexibility for unlimited withdraw. Furthermore , Current Account can be linked to call Account so that balance exceeding the agreed amount in current account can be transferred automatically to call account on a daily basis and earn you interest.

Why this cap on Call Deposit?

Through this circular NRB is trying to put cap on call deposit but why our central bank is doing so, doubt may arise in your mind?

Through this circular NRB concern seems to be focusing on liquidity issues in BFI, what is your understanding on today's issued circular?

This must be stopped, This is Heart breaking!

We are in 2k76 BS as per Nepalese calendar. You can obserb mela in different part of siraha on every new year. On every new year here in Golbazar people celebrate it in a unique and pleasing way. I was there at Dhamini Temple to observe this unique way to welcome new year, I was there to enjoy the mela, I was there to get into the temple for worship and prayer. I clicked few photos in front of Dhamini mai Temple. It was my first click of 2k76 BS, Initially I was happy to see my click but later I became unhappy to see that picture. Let me now share that click.

I was happy to see those balloon i clicked. It was random click, when I was scrolling my gallery I saw this pic, I was happy to see those colorful balloons but I became sad to see the kid who is holding those ballon. 

There are two kid in the picture you can see holding those balloon to sell them on new year. Looking at their age it's seems they themselves needs toys to play and needs school to study. But they are selling toys, you may wonder why? Well An empty stomach can't think of toys, An empty stomach can't focus on study. Now the answer is quite simple. Yes! They are doing this for their very basic need that is food. Poverty is alarming 

If you have visited kathmandu and have used local transportation to travel different places in kathmandu, you must have notice that conductor of the most of the vehicle is under age to work as conductor. There many small kids who have been involved in begging on the street. There are many who have been working as: a dishwasher in hotels, a sales boy and many have been involved in agricultural activities as well.

Child should enjoy their childhood, they should enjoy their education. Child shouldn't be a begger, not be a bus conductor, neither be a sales boy, nor be a dish washer in hotels, not even a farmer! Child labor exist in our country and across the globe! It kills the childhood of child, it is against their health and right aswell.

Picture above shows that child rights have been ignored, not only the picture posted above in this article, you google child labour in nepal and you will see the condition, Indeed It depicts that their future is at risk. But how can child labor be stopped? Who is responsible for child labour? Government should come up with strict legal provision to control child labour, Not only Government, concerned authority , NGO, INGO as an individual we all should do bit from our end too on this issues! This must be stopped, this is heart breaking!

Free Bank Account With Rs100 bonus balance!

Are you still unbanked ? Are you one of those who have no bank account with any bank? In nepal though bank have reached in most of the rular area, data shows that there are still many people who have no bank account with any bank. Considering unbaked population of Nepal NRB issued a new circular on Bank account opening campaign (#खोलौ_बैंक_खाता)  as on 10th April 2019(2075/12/27) for BFI class A, B & C.
NRB came up following provision to be followed by all BfI on said campaign:

1) KYC and related provision of Bank account opening campaign 2076:

As per this campaign to open bank account for all Nepali unbanked natural person following criteria and process should be obtained for KYC and confirmation.

👉 As per this provision BFI shall use simplified account opening form to open a bank account. Under this provision it is mandatory to obtain no multiple banking declaration during opening a bank account.

👉 For KYC and other confirmation should be based on citizenship certificate or Passport or election ID card with photo or National ID card or Driving license or Government issued photo ID or letter containing photo issued by local authority.

👉The maximum transaction limit shall be 1 lakh. KYC and other related confirmation should be obtained if transaction limit crosses 1 lakh.

 As per this provision BFI can make deposit of Rs 100 after opening the bank account.

Concluding...

NRB though this circular intended to attract all those Nepalese who still have no account with any bank. Now question arises will this circular impact positively and attract all those who have been remained unbanked? So as for this campaign BFI needs to use a simplified account opening form and bank shall deposit Rs100 in all those account meeting above criteria may attract those people towards banking. Certainly this is good step towards the vision of financial conclusion, and this will help to bring those unbanned population into banking Chanel!

Jack Retirement:Beginning of New Chapter!

Jack Ma failed in main primary school test two times, He failed the middle school test three times and college entrance exam two times.

Transparency & Accountability Deficit of INGO in Nepal!

INGO’s And Its Role: 

Mission wise there is less difference between INGO and NGO, but INGO has its international scope and has its presence around the world to deal with specific issues in many countries.

Nepal's Treaties & Agreement: what & Why?

DTAA:

What?

With the aim of encouraging Indian investment in Nepal the GON and GOI entered  a double taxation avoidance agreement (DTAA) and a prevention of fiscal evasion agreement in 2011

Why?

Low CAPEX Hurting Growth

Nepal’s capex is much lower than what is required to close the infrastructure deficit said ADB.

The country requires capital spending to reach 8.2-11.8 percent of the gross domestic product (GDP), but it has stood at just 3.3

Watch List

NRB came with a new directive (as on 29-11- 2071) which direct bank and financial institution to add one additional type of loan in their loan category as "Watch List".

BFI will have to classify their loan and advances into five category including "watch list" as new one.

What is "Watch List"?

As per the new NRB directive- A loan having met all the criteria of standard or good loan but showing sign of vulnerability will have to be categorized under a new type of loan i.e. Watch List.

# Pass loan(Not overdue and over due upto 3 month):
Loan and advances whose interest and principal is being paid by the  client on the regular basis or with in the time period of three month is called pass loan. The provisioning requirement for this kind of asset is 1% of total pass(standard) loan

# Watch list:
As explained above it is new category of loan which posses the characteristics of pass loan but carry/shows some amount of potential risk. The purpose of identification of potential NPL is to ensure that timely appropriate corrective steps could be initiated by BFI to protect against the NPL. As per new directive of NRB, BFI from now afterwards will have to maintain 5 % provision for this category of loan. As per NRB directive under below condition loans/advances shall categories under watchlist category:

a) Principal or intrest overdue by above 1 months

b) All Short term or working capital loan pending for renewal & all temporary extension.

c) All those loan which has been categorised under Bad loan

d) Despite of regular payment of interest & principal by Firm/company but suffering loss for two consecutive FY. But the loan provided to project under construction, these arrangements shall be applicable only after commercial production.

e) As per point numbers 33 of NRB directive all multi Banking loan which has not been converted in to consortium financing.

f) All those loner whose cash flow & week operations of the project & which is directed to keep under Watch List by NRB after  supervision

# Substandard Loan(over due by 3-6 month):
Under this category all those loan whose interest and principal remain unpaid for the period of three to six month is regarded as substandard loan. The provisioning requirement for this kind of loan is 25% of total substandard loan.

# Doubtful Loan (overdue by 6-12 month):
Interest and principle remain due up to six to twelfth month of due date is categorized as doubtful loan. The provisioning requirement is 50% of total doubtful loan.

# Loss Loan( overdue by 1 year and above):
Interest and principle remain due up to 1 year and more is termed as loss loan. 100% provisioning is made for this type of loan.

*Performing loan=
Pass loan+ watch list

*Non-Performing loan=
Substandard loan + Doubtful loan + loss loan

Conclusion...

Non performing loan is one of the major issue faced by BFI in nepal. Increasing level of NPL is putting pressure over banking industry of nepal. In this situation this new directive will have some positive impact in lowering the level of NPL in effective way.

Economic Development

Introduction

Development is positive changes in living standard. Development is a continuous and collective process and the aspects of development includes economic, social, political and human.

Improving Reading Habit!

There can be different reason for reading books to different people. We don't require to think much about the reason behind reading books regularly, no doubt this habit has great impact...i remember a quote that "when you are reading you are not alone" this is true because when ever you read a book you visualize which create an image in your mind. I have my own reason behind reading the books that's why I love reading books...How to improve reading habit? Few of you may have this question in your mind so today on this prestigious day of "Sarswati puja" i want to talk about how and why to improve reading habit. This is few tricks which i have applied in myself and believe me this works.

Newspaper:
the first thing you need to do is read news paper every morning. While you are reading make sure you read a bit louder this will improve your speaking skill too.

Comics:
You think your English is poor ?, well reading comics can have great impact. Comics includes different dialogue with picture so if you don't understand the dialogue, picture can be helpful in that case. 

Movie with subtitle:
If you are watching movie make sure that you watch it with subtitle. So reading subtitle has also good impact on improving reading habit.

Library:
visit to the library on the regular basis beside this you can have your own library. Keep the collection of all those book which you love to read.

Environment:
find a quite place for reading. This have great impact on understanding what you read, so make sure you have good environment for reading. Try to avoid disturbing factor.

Read it what you see:
you got a product in your hand read the description of that product, for example if you are hungry and you bought lets say WiWi noodles or any other product, you can read the description given on the wrapper. You can do this on any products like chocolate, biscuit, medicine, manuals etc.

Visualize:
while you are reading you need to visualize it. If you are reading any novel you need to create a visual in your mind, this will help to remember for long. It improves memory power.

Read regularly:
Try to read on the regular basis no matter whether you read for ten minutes or hours... you need to keep on doing this on the regular basis.

Make a Note:
Last but not the least, maintain a proper dairy for what ever you read. Choose the topic you like most and maintain a note own your own. This will improve your writing skill too.

These are few tricks which i have applied with me and its fun. What do you think is this helpful to improve reading habit. Don't forget to leave your thinking on reading books below in the comment section. Thanks