Kathmandu. According to the latest statistics of Nepal Rastra Bank, the share of fixed deposits in the total deposits of banks and financial institutions has declined rapidly.
According to the data, fixed deposits, which accounted for 56.4 per cent of the total deposits at the end of July 2081, have declined to 48.3 per cent in 2082 and to 35.3 per cent by the end of July 2083. The steep decline in the share of fixed deposits by 21.1 percentage points in the period of three years clearly shows that there has been a major change in the structure of deposits in the financial system.
The main reason for the decrease in the share of fixed deposits is the continuous reduction in the interest rates given by banks and financial institutions on deposits. Depositors are reluctant to keep the money tied for a long period after banks cut the interest rate of fixed deposits significantly due to the accumulation of excess liquidity in the market.
Due to this trend, the share of ordinary savings has increased from 30.3 percent in 2081 to 47.0 percent in 2083, while the share of current accounts has increased from 5.8 percent to 8.1 percent.
