An Industrial loan is any type of loan made to a business or corporation, as opposed as to an individual. Industrial loans can be made in order to provide either working capital or to finance capital expenditures such as acquire or significantly improve assets such as land, buildings, equipment, furnishings, fixtures, vehicles. This type of loan may be short-term or long term in nature and is almost always backed by some sort of collateral.

A business loan is a loan specifically intended for business purposes. Business loans can be made in order to provide either working capital or to finance capital expenditures. As with all loans, it involves the creation of a debt, which will be repaid with added interest. This type of loan may be short-term or long term in nature and is almost always backed by some sort of collateral.

A service sector business loan is a loan specifically intended for business purpose of service nature. This basically caters to hotels/resorts, restaurants, airlines, travels/trekking agencies, organized transport sector, hospitals/clinics/pharmaceutical units, etc. It can be made in order to provide either working capital or to finance capital expenditures. This type of loan may be short-term or long term in nature and is almost always backed by some sort of collateral.

A real estate loan is a loan provided to individual/firm/company to acquire or significantly improve assets such as land, buildings or to construct buildings on acquired land for residential or commercial purpose. This type of loan is usually in term nature.

Inter-Finance Institution loan or Inter-bank lending is a short-term instrument that banks/financial institution use to borrow money from another institution. The loan must be repaid in seven days, unless it is rolled over. Generally, inter-bank loans are used to replenish the cash reserve ratio (the portion of deposit that banks must park at the central bank).

Professional Loan may be asset based or non asset based lending mainly targeted towards meeting various requirements of professionals like Doctors, Engineers, Pilots, Chartered Accountants, NRB Officers, Government/Semi Government Officers, Govt. Owned Corporation/Organization’s Officers, Bankers, University Lecturers (Permanent), Principals or higher authorities of Schools/Colleges, PhD Holders, Employees of Big Corporate Houses and other very similar professions for the fulfillment of their personal/professional requirements. The loan constitutes both revolving and/or term loans paid on Equated Monthly Installment (EMI) basis. Revolving loan shall not exceed more than NRs. 5 Lakhs per individual.

Personal Loan will be provided primarily for fixed asset investment and or to meet personal financial requirement by an individual. Fund may also be used at their discretion Credit Policy Guidelines- 2019 Page 19 of 40 (except illegal/terrorist activities) and such lending (without purpose) shall not be greater than NRs. 5 million or as per NRB directives from time to time. The loan limit may be processed in higher amount than NRs. 5 million if the purpose and use of fund is justified. Customer need and profile shall be duly assessed while determining the loan limit. Personal Loan may be a revolving or term line of credit that is extended against selfowned property.

: Productive sectors are the real sectors of the economy. Sector components of GDP such as agriculture, tourism, hydropower, industries etc. and services are the productive sectors. It reflects the viable, creditworthy picture of an economy emerging. Investment on the productive sectors has been a main focus thus to stimulate economic growth and generate income and employment opportunities. This type of loans can be made in order to provide either working capital or to finance capital expenditures such as acquire or significantly improve assets such as lands, buildings, equipments, furnishings, fixtures, vehicles. This type of loan may be short-term or long term in nature and is secured by adequate and acceptable collaterals.

Loan granted for purchase/acquire of shares of approved listed Public Limited Companies in Nepal Stock Exchange (NEPSE). The end use of this loan can be social expenses, consumption, asset creation or leverage further investments. The loan is provided against pledge of listed shares.

Refer to (CPG) Chapter-9.

Unified Agriculture Loan will be provided for fulfilling the financing need (Working Capital as well as Fixed Capital) of Nepalese Farmers and Firms/Companies for agriculture related purpose. Loan will be provided for farming, including cultivation of the soil for the growing of crops and the rearing of animals to provide food, wool, and other products, also loan will be provided to those Farmers/Firms/Companies who are associated with processing, manufacturing, marketing and selling of the agricultural products. This type of loans can be made in order to provide either working capital or to finance capital expenditures. This type of loan may be short-term or long term in nature and is secured by acceptable collateral security.

Deprived sector lending is desirable and prioritized as per the national policy objectives of the Government of Nepal to empower socially and financially deprived/underprivileged people such as rural women (Mahila), Janjati, Dalit, Farmers and foreign workers etc. However, such facilities should fall within the framework of credit risk assessment of the Finance. PFL will allocate funds (in wholesale or in retail) to support this sector and see that funds allocated for this sector are used for end use as per specified purpose and that repayments are achieved and the target groups are benefited.
Credit Policy Guidelines- 2019 Page 20 of 40