Wednesday, June 2, 2010

Nepal government introduced new regulations for loan sanctioning under YESEP

In order to reduce the risk of loan sanctioning under the Youth and Small Entrepreneur Self-Employment Programme (YESEP), new regulations have been proposed by the parliament. Till date, banks had to sanction loans considering the project as collateral.

Under the new proposal, instead of government officials overlooking the fund, it would be considered as a project.

As per the report of The Kathmandu Post, the proposals have been sent to the cabinet for approval.

The YESEP was introduced by the Maoist-led government and the UML-government is continuing it. A total of Rs.3 billion has been allocated under this project. Bishnu Prasad Lamal, Joint Secretary of Finance Ministry, oversees YESEP.

Sashin Joshi, President, Nepal Bankers Association, said that the banks did not provide loans for applicants did not meet their standards.

Mr. Joshi said that his bank had been seriously thinking about investing in the handicraft sector under the YESEP programme.

About half a million people applied when the programme started. Out of them, 2,75,000 people received training to become eligible for receiving loans under the program.

Government just started the implementation of the project by distributing rickshaws among rickshaw pullers so that they can buy their own rickshaws. KIST bank of Nepal has taken this initiative.

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