Functions, Duties and Rights of Nepal Rastra Bank (NRB)

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functions of NRB

The central bank is established in every country for the monetary, banking and financial development. The central bank is established for regulating the banks and financial institutions as well as helping in formulating the monetary policies in the economy. The major functions and rights of the central bank are as follows –

Functions and Duties of Nepal Rastra Bank

  1. To issues banknotes and coins
  2. To formulate necessary monetary policies and implementation in order to maintain price stability
  3. To formulate foreign exchange policies and to implement or cause to implement them
  4. To manage and operate foreign exchange reserve
  5. Issuing license to commercial banks and financial institutions to carry on banking and financial business and to regulate, inspect, supervise and monitor them
  6. Act as banker/ agent/ financial advisor of the Government of Nepal
  7. Act as the bank of the banks and to function as the lender of the last resort
  8. Develop and promote a secure, healthy, efficient payment system
  9. Raising money for the Government of Nepal
  10. Make appropriate supervision of the baking and financial system in order to maintain its stability and foster its healthy development
  11. Perform other activities required to obtain other objectives

Rights of Nepal Rastra Bank

  1. For the purpose of the recovering any loan, which the bank has given to any borrower or any other type of claim of the bank against any borrower, the bank shall have prior right of security over cash deposited in an account in the name of such borrower at the bank or in any commercial bank or financial institutions or against any other movable and immovable property owned by the borrower for the purchase of recovering such loan.
  2. The Bank shall recover its own loan by taking into its custody the cash or movable or immovable property having its prior right and selling such property as prescribed.

Nepal Rastra Bank Act 2058 in Nepali & English Summary