Kathmandu: Nepal Rastra Bank’s new policy limiting bank and financial institution loans to a maximum of 60% of the value of electric vehicles (EVs) has officially come into effect. The central bank implemented the policy after issuing directives following a monetary policy review.
Previously, banks and financial institutions provided loans covering up to 80% of the cost of personal EVs and up to 100% for public electric vehicles. Under the new rule, the loan cap for personal EV purchases has been reduced, while financing for public EVs remains unchanged.
Meanwhile, the loan limit for petrol and diesel-powered personal vehicles has been increased from 50% to 60%. However, financial institutions can still provide full loans for public vehicles running on fossil fuels.
Business representatives have expressed concerns over the policy change, noting that around 70% of vehicles in Nepal’s current market are electric, with only 30% being fuel-powered. They argue that restricting financing for EVs could have negative consequences on the overall economy and slow down the transition to cleaner transportation.