Himal Press 
KATHMANDU: Banks have further reduced interest rates on deposits. According to the new rates published by commercial banks for the month of Bhadra (mid-August to mid-September), the average maximum interest rate on deposits has decreased by 0.18 percentage points.
While the average maximum interest rate on personal fixed deposits stood at 5.68% in Shrawan (mid-July to mid-August), it has dropped to 5.57% for Bhadra.
Out of 20 commercial banks, 8 have lowered their maximum deposit interest rates, while 12 have kept them unchanged.
Banks that reduced their rates include Agricultural Development Bank, Everest Bank, Laxmi Sunrise, Standard Chartered, Siddhartha, Kumari, Sanima and Nepal SBI. The 11 banks that maintained their rates include Citizens Bank, NMB, Nepal Investment Mega, Himalayan, Prime Commercial, Global IME, Rastriya Banijya, Nabil, NIC Asia, Machhapuchchhre and Nepal Bank, while Prabhu Bank Ltd has raised its rate slightly.
Banks generally offer lower interest rates for short-term fixed deposits and slightly higher rates for long-term deposits. The published maximum interest rates typically apply to long-term deposits.
For short-term fixed deposits, most banks are offering below 5% interest. For deposits longer than two years, banks are offering interest rates ranging from a minimum of 5% to a maximum of 6.25%.
A decrease in individual fixed deposit interest rates leads to a reduction in both savings and loan interest rates as well.
Nepal Rastra Bank has reduced all components of the interest rate corridor for the current fiscal year. As a result, banks had cut rates for the first month of the fiscal year, i.e., Shrawan. The downward trend has continued into the second month.
In the monetary policy for fiscal year 2025/26, the central bank reduced the bank rate from 6.5% to 6%, the policy rate from 5% to 4.5%, and the deposit collection rate from 3% to 2.75%.
