Nepal has a law called BAFIA law that controls how banks and financial companies should work. This law was made in 2073, and now the government wants to change it. The change was sent to Parliament on Chaitra 5, 2080, but full discussion has not started yet. It is now being looked at by a committee.
During early talks, Nepal’s new central bank governor said this change could shake the country’s financial system. After his statement, the stock market reacted with some ups and downs.
What Is in the New Proposal?
One main point of this proposal is to separate bankers and business owners. Right now, people who own 2% or more of a bank’s shares cannot take loans from banks. The new rule wants to make this stricter. If passed, anyone who owns just 1% or more of a bank’s shares cannot take loans from any bank.
This means — you can either run a bank or run a business, not both.
How Could This Affect Nepal’s Economy?
The central bank governor said that most loans in Nepal go to a few rich people who also own shares in banks. If this law is passed, those people will have to either sell their bank shares or pay back their loans.
But selling those shares might not be easy, and banks may find it harder to give out loans. There are already too few new businesses, and if old borrowers are blocked, the economy might slow down for a while.
What Are the Possible Benefits?
Even though the law could cause short-term problems, it could help in the long run. Right now, a few rich people control most of the money. Small business owners often cannot get loans. This law could change that by giving new people a chance to grow businesses or become bank owners.
One good idea is to give these big business owners up to 5 years to adjust. They could either repay old loans or sell their shares slowly.
