KATHMANDU: Governor of Nepal Rastra Bank (NRB), Maha Prasad Adhikari, on Tuesday announced that agreements with China and Sri Lanka on digital payments have reached the final stage.

Speaking at an interaction on next year's monetary policy organized by the Federation of Nepalese Chambers of Commerce and Industry (FNCCI) on Tuesday, Governor Adhikari said that agreements with China's Ali Pay and Sri Lanka's Lanka Pay for digital payment transactions are expected soon.

Adhikari noted that the volume of transactions with India has increased following the initiation of cross-border digital payments.

He also mentioned that discussions with officials of the Reserve Bank of  India are ongoing to enable transactions using Indian notes of denominations 500 and 1,000.

Governor Adhikari promised that objective analysis of facts, statistics, and practices will be conducted in preparing the monetary policy for the upcoming fiscal year.

During the interaction, FNCCI President Chandra Prasad Dhakal urged the Governor to develop a monetary policy that would encourage industries to enhance their production capacity and stimulate market demand. Dhakal noted that loan expansion is lackluster despite sufficient liquidity in banks and financial institutions.

Dhakal also suggested that the monetary policy should include provisions to implement the announcement of reduced interest rates for the industrial sector.

"Industries' capacity to repay loans has diminished due to the drop in demand. This issue must be addressed. We demand a policy that encourages investment," FNCCI President Dhakal stated. -- RSS