Governor, NADA Chief meet; 5-point proposal tabled

KATHMANDU: A delegation from the NADA Automobiles Association of Nepal, led by Chair Karan Chaudhary, held a courtesy meeting with newly appointed Governor of Nepal Rastra Bank, Dr. Bishwanath Paudel, to discuss key policy issues affecting the automotive sector.

During the meeting, Chair Chaudhary presented a five-point proposal aimed at revitalizing Nepal’s automobile industry, which he emphasized is closely linked to the nation’s revenue generation, employment, technology transfer, and sustainable development goals.

Key Recommendations by NADA:

1. Practical Implementation of Auto Loans
   Although the central bank opened avenues for auto loans a year ago, commercial banks have been reluctant to implement it. NADA urged for clear directives to ensure the practical flow of loans to revive the sector.

2. Increase Loan-to-Value (LTV) Ratio to Minimum 70%
   The current LTV cap of 50% has severely restricted both consumers and businesses. NADA requested an upward revision to a realistic and functional level across all automobile segments.

3. Introduce Flexibility in Debt Service to Income Ratio (DSR)
   The existing rigid DSR policy is making it difficult for middle-class, salaried individuals to qualify for auto loans. NADA stressed the need for practical leniency in the criteria.

4. Launch Targeted Financing Schemes for EVs and Hybrids
   To support Nepal’s green energy and environmental goals, NADA recommended the introduction of special credit facilities, refinancing options, and incentive programs for electric and hybrid vehicles.

5. Ensure Fairness in the Financial System through Stricter Regulation
   NADA highlighted the issue of banks pushing clients to use specific dealer-affiliated institutions, thereby limiting competition. The association urged the central bank to enforce stricter regulations to ensure transparency and fairness.

Chair Chaudhary emphasized that balancing policy, finance, and implementation is vital to strengthening Nepal’s automotive sector.

Vice Chair Rajan Babu Shrestha proposed a collaborative national interaction program with Nepal Rastra Bank to help shape long-term economic policies related to the industry.

Governor Dr. Paudel assured the delegation that the central bank would seriously consider the suggestions and work in coordination on necessary matters.

Also present at the meeting were NADA General Secretary Bikram Singhania, Treasurer Milan Babu Malla, Joint Treasurer Pankaj Agrawal, and Executive Committee Members Yamuna Shrestha and Dipendra Kumar Mishra.