Banks are experiencing an increase in the amount of unutilized funds due to the inability to lend. This surplus of funds kept in the central bank is directly proportional to the inability to extend loans. The scenario suggests that as the lending capacity diminishes, the surplus funds deposited in the central bank increase.
The current situation in the banking sector highlights a concerning trend where banks are unable to lend out funds, resulting in an accumulation of idle money in the central bank. This surplus of funds not only signifies a lack of investment opportunities but also indicates a potential slowdown in economic activities.
Ramesh Khatri, a representative of Kansai Nepal News, expressed his views on this matter. He emphasized the need for banks to reassess their lending strategies and explore avenues to stimulate credit flow into the market. Khatri suggested that proactive measures should be taken to encourage borrowing and investment, ultimately fostering economic growth and stability.
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Author: MAYA | HARUTO
Posted at: February 5, 2025 7:00 pm