July 21: In recent times, most of the concessional loans have flowed to women entrepreneurs. Altogether 43,831 individuals have received the women entrepreneurship loans from banks and financial institutions (BFIs) in the first 11 months of the Fiscal Year 2020/21.

The number of women taking loans under this heading has reached 50,513 as of mid-June. The debt arrear was Rs 44.66 billion under this heading during the review period. In the previous fiscal year, only 6,682 women had availed such loan. However, this number has been increasing every month.

There is a provision to take a concessional loan under the heading of Women Entrepreneurship at a subsidized interest rate of 6 percent. Individuals can apply for up to Rs 1.5 million per person.

Although loan under this heading should be provided without any collateral, BFIs are found seeking collateral from the service seekers.

Chairman of the Nepal Bankers' Association Bhuvan Kumar Dahal says that the banks are willing to provide women entrepreneurship loans by keeping collateral as there is high risk of giving loans without collateral.

According to the Nepal Rastra Bank, individuals taking concessional loans for CTEVT trainings is the lowest among those seeking concessional loans.  Only two people have taken such loan worth Rs 370,000. Bankers say that such loans do not flow because of the low demand under the heading. Similarly, only three individuals have taken youth self-employment loan. This heading has arrears of Rs 1.5 million.

So far, only 141 borrowers have availed the 'Educated Youth Self-Employment Loan' under the concessional loan programme of the government. Statistics show that they have a debt of Rs 62.6 million. In the first 11 months of the last fiscal year, 76 more individuals received Educated Youth Self-Employment Loan'.

Individuals complain that bankers are hesitant to offer loans to students against their certificate despite the government’s announcement to avail loans to students by keeping their certificates as collateral. Bankers say there is a risk in giving loans to students against their certificates.

The government has announced loans up to Rs 2.5 million for students in the budget of the current fiscal year. However, it would be hard to avail such loan unless there is an excellent project plan and trust, says Dahal.

Approximately 791 people have availed the Youth Project Loan for Returnee Migrant Workers. BFIs have provided Rs 578.2 million to the returnee workers under this heading.

Similarly, banks have disbursed Dalit community business development loans worth Rs 522 million to 857 individuals. So far, 232 earthquake-affected people have received loans for the construction of private houses. In addition, 218 garment manufacturers have also availed concessional loans worth Rs 2.23 billion.

According to Narayan Prasad Poudel, Joint Spokesperson of the Central Bank, 96,852 borrowers have availed concessional loans of Rs 150.96 billion in 11 months of last fiscal year.