January 9: Former finance minister and former governor of Nepal Rastra Bank Yuba Raj Khatiwada has said that it is necessary for banks and financial institutions to increase the quality rather than the size of loans. Addressing the 3rd annual general meeting of Confederation of Banks and Financial Institutions of Nepal on Sunday, former finance minister Khatiwada suggested banks to increase the quality of loans arguing that there may be risks when they increase the size of loans.

He said that although the electronic sector has benefited from the capital increase of the banks, the agricultural sector is yet to benefit. Stating that the size of loans issued by banks and financial institutions is equal to the size of the economy, he said that the increase in the size of the loan indicates an economic crisis in the financial system. He also said that the financial system of the country has taken a big leap recently.

Former finance minister Khatiwada also remarked that he has an increased confidence that the deposits in banks will not sink. He mentioned that the use of information technology in the entire financial sector, including the banking and capital market, has increased rapidly, and the central bank will also undertake its works electronically.