Debt Recovery Tribunal

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Background
Looking at the development of the banking sector in Nepal.  Nepal Bank Limited was established in 1994 and has been serving as Nepal Industrial Development Corporation 2016, Rastriya Banijya Bank 2021, Krishi Vikas Bank 2024 and Government Bank respectively. Nepal's financial sector reform program started in the 1980s.  Its main objective was to improve the financial sector by increasing public and private sector participation in the economic sector, maintaining financial discipline, transparency and good financial governance.  In this context, the government changed its economic policy and with the joint participation of foreigners, banks of Nepal Arab Bank (Navil Bank), Indo-Swiss Bank (Nepal Investment Bank), Grindlej Bank (Standard Chartered Bank), Himalayan Bank Limited, Nepal SBI Bank and Everest Bank Limited were established in 2041 BS.  The development of the banking sector seems to have taken off.  The Integrated Financial Sector Reform Program has been implemented since 2001 with the joint participation of the Government of Nepal, World Bank and Asian Development Bank as the financial condition of public sector banks has been declining and the non-performing capital has been increasing along with the development of banks and financial institutions.  Under this reform program, the Nepal Rastra Bank Act, 2058 (Repeal of 2012) and the Banks and Financial Institutions Debt Recovery Act, 2058, Banks and Financial Institutions Ordinance, 2058 (Act, 2063) have been enacted to amend the Financial Sector Act.  2024, Commercial Banks Act 2031, Finance Companies Act, 2042, Nepal Industrial Development Corporation-2046, Development Banks Act, 2052 have been repealed and come as an umbrella act.  Thus, the Government of Nepal has passed the Debt Recovery Act, 2058, Rules 2060 by making institutional arrangements for the recovery of non-performing loans of banks along with the Financial Sector Reform Program.

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