Professional / Personal Loan

A personal loan in Nepal is a multi-purpose retail loan offered by commercial banks (Class A), development banks (Class B) and finance companies (Class C) to individuals to meet personal needs such as medical expenses, travel, education, social functions, home renovation or debt consolidation. It comes in two main forms: an unsecured/non-collateral personal loan assessed purely on the borrower's salary or verifiable income (commonly up to about NPR 15 lakh, e.g. NIC Asia, Standard Chartered), and a secured personal/mortgage overdraft loan backed by land/building collateral for larger amounts. Repayment is typically on an EMI basis for term loans or on a revolving basis for overdrafts, and the bank's total EMI/debt-burden cannot exceed roughly 50% of the borrower's gross monthly income. Approval depends on income stability, a clean CIB (Credit Information Bureau) record, and completion of NRB-mandated KYC.