Registration of personal vehicles falls as banks tighten lending

KATHMANDU, April 22: Registration of personal vehicles saw a drastic drop in the seventh and eighth of current fiscal year, thanks to tightening bank loans.

The registration of personal vehicle which was as high as a little over 3,000 in mid-November of this fiscal year went down to 1,786 and 1,307 in mid-February and mid-March respectively. The personal vehicles were registered at an average rate of over 2,000 in the first three to four months of the current fiscal year. The registration of personal vehicles in mid-February and mid-March of last fiscal year was 2,678 and 2,765.

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According to the Ministry of Physical Infrastructure and Transport, registration of personal vehicles like car and jeep fell to 1,786 and 1,307 in the seventh and eighth month of 2016/17, respectively, from an average of around 3,000 couple of months ago. Altogether 2,678 and 2,765 personal vehicles were registered in the seventh and eighth month of the last fiscal year.

The demand for personal vehicles, which was very high from the beginning of the current fiscal year, declined due to shortage of lendable fund in banking system which led to tightening of credit flow to automobile sector, according to automobile dealers. 

The central bank has allowed bank and financial institutions (BFIs) to lend only up to 50 percent of the valuation of motor vehicles. Earlier, they were lending as high as 80 percent of the valuation.

Statistics compiled by the ministry shows 11,372 personal vehicles were registered in Fiscal Year 2013/2014 and 13,560 in 2014/15. The number jumped to 28,361 in 2015/16.

Meanwhile, registration of two-wheelers has slightly increased in the first eight months of the current fiscal year, compared to registration figures of the same period of the last fiscal year. While 193,737 two-wheelers were registered in the country over the first eight months of 2015/16, altogether 199,908 two-wheelers were registered in the same period of the current fiscal year.

According to the ministry, altogether 263,817 motor vehicles were registered in the first eight months of this fiscal year. Altogether 231,143 motor vehicles were registered in the country in the first eight months of 2015/16, 160,992 in 2014/2015 and 129,964 in 2013/2014.