Many banks in the country have suspended giving loans and in some instances reduced the percentage of loan. These are vehicle and housing loans. This is being done as it has a bearing on the Rupee.
The Druk Punjab National Bank reduced its vehicle loan to 50 percent. Earlier it gave 75 percent. The Bank has also increased the interest rate of the housing loan to 11 percent from 10 percent.
The Bhutan National Bank has also decreased its vehicle loan to 50 percent and suspended the housing loan for now. The Chief Executive Officer, Kiphchu Tshering, said this was done as it has a bearing on the rupee crunch.
“We have to comply on the norms of RMA. So we have to decrease lending of loan as far as possible. Any expenditure in the form of loan about 70 to 80 percent of loan goes back in the form of imports because we don’t produce anything here in Bhutan,” he said.
The Governor of the RMA, Daw Tenzin, said rupee crunch is becoming a serious concern as everything is being imported. “Many Bhutanese are taking Ngultrum loan from the bank to construct building and buy vehicles. Through the banking channel it has led to the Rupee import. For example people lend housing loan from the bank and take money to the border. The Indians then come to our bank and take away Rupee overdraft.”
The T-Bank has stopped giving vehicle loan for the purchase of taxis and heavy vehicles. It has also suspended the housing loan but refused to comment why.
Similarly, the Bank of Bhutan has also suspended some of the loans. It also did not want to comment on which loans were suspended and why.
