Himal Press 
Source: Nepal Rastra Bank
KATHMANDU: Credit expansion moderated while deposit mobilisation picked up pace in the first eight months of fiscal year 2025/26.
According to macroeconomic data for the first eight months of the credit fiscal year released by the Nepal Rastra Bank (NRB), credit to the private sector continued to grow in the review period, albeit at a slow pace. Private sector credit increased by 4.4% percent, or Rs 243.54 billion, reaching Rs 5.74 trillion by mid-March. This is lower than the 6% percent growth recorded a year earlier. On a year-on-year basis, credit growth stood at 6.7%.
Commercial banks led lending expansion, with a 4.6% increase, while lending by development banks and finance companies expanded by 3.5% and 1.9%, respectively.
Credit to the consumable sector rose sharply by 10.5%, followed by construction (8.8%), transportation and communication (7.7%), and industrial production (5.6%). Growth in the service sector, however, remained subdued at 1.8%, while lending to agriculture declined by 2%. Credit to finance, insurance, and fixed assets also fell by 2.7%.
Loan categories linked to imports and market activity saw stronger growth. Trust receipt loans surged by 23.2%, while margin lending grew by 11.1% and hire purchase loans by 8.6%. In contrast, overdraft loans declined by 2.7%.
Meanwhile, deposit mobilisation accelerated significantly in the review period. Deposits at BFIs increased by 6.6%, or Rs 482.01 billion, reaching Rs 7.75 trillion in the review period—up from 4.3% growth a year ago. On a year-on-year basis, deposits expanded by a robust 15.1%.
The share of savings deposits in total deposits rose sharply to 44.1% from 35.4% a year ago, while fixed deposits declined to 40.1% from 51.7%. Demand deposits increased to 6.6%.
The falling share of fixed deposits in total deposits has been attributed to low interest offered by BFIs on fixed deposit products.
Institutional deposits accounted for 34.3% of total deposits, slightly down from 35.4% a year ago.
