date convert Home Top

Minimum Capital Required for Banks and Financial Institutions in Nepal 2022

The Bank and Financial Institution Act, 2073 classifies Banks and Financial Institutions into A, B, C, and D classes. According to this act, Nepal Rastra Bank shall make provision for the minimum capital required for each class of Banks and Financial Institutions in Nepal.

According to the directive published by Nepal Rastra Bank, the following is the detail of the minimum capital required for Commercial Bank, Development Bank, Finance Companies, and Micro Finance Financial Institutions.

Minimum Paid Up Capital

Minimum Capital Required for (A- Class) Commercial Banks

The commercial Banks (A-Class) have to maintain at least Rs. 8,000,000,000.00 as paid up capital.

Types of Banks or Financial InstitutionOperation LevelClassMinimum paid-up Capital (NPR)
1. Commercial BankNational LevelA Class8,000,000,000
Minimum Paid Up Capital Requirement for A- Class Commercial Banks

Minimum Capital Required for (B- Class) Development Banks

The Development Banks (B-Class) have to maintain the following minimum paid-up capital depending upon the level of operation.

Types of Banks or Financial InstitutionOperation LevelClassMinimum paid-up Capital (NPR)
2. Development BankNational LevelB Class2,500,000,000
3. Development Bank
(Operating in 4 to 10 districts)
District LevelB Class1,200,000,000
4. Development Bank
(Operating in maximum 3 districts)
District LevelB Class500,000,000
Minimum Paid Up Capital Requirement for B-Class Development Banks

Minimum Capital Required for (C- Class) Finance Companies in Nepal

The Finance Companies have to maintain at least the following amount of paid-up capital depending upon the area of operations.

Types of Banks or Financial InstitutionOperation LevelClassMinimum paid-up Capital (NPR)
1. Finance Company
(National Level)
National LevelC Class800,000,000
2. Finance Company
(Operating at least in 4 districts)
District LevelC Class800,000,000
3. Finance Company
(Operating in maximum 3 districts)
District LevelC Class400,000,000
Minimum paid-up capital required for C- Class Finance Companies in Nepal

Minimum Capital Required for (D- Class) Micro Finance Financial Institutions in Nepal

The micro-finance financial institutions shall maintain the following minimum paid-up capital.

Types of Banks or Financial InstitutionOperation LevelClassMinimum paid-up Capital (NPR)
1. Microfinance CompanyNational LevelD Class100,000,000
2. Microfinance Company
(Operating in certain development region)
Regional LevelD Class60,000,000
3. Microfinance Company
(Operating in 4 to 10 districts)
District LevelD Class20,000,000
4. Microfinance Company
(Operating in maximum 3 districts)
District LevelD Class10,000,000
Minimum paid-up capital required for D- Class Micro Finance Financial Institutions in Nepal

In addition to that, Commercial banks have to also consider the directives related to compliance with BASEL-III directives. According to it, the commercial banks must maintain the regulatory minimum paid-up capital and then the minimum paid-up capital required under BASEL adjusting the risk exposure of the assets.

Newsletter Updates

Enter your email address below to subscribe to our newsletter

One comment

Leave a Reply

Your email address will not be published. Required fields are marked *