KATHMANDU: Commercial banks have decided to keep the interest rates of deposits stable for the month of Kartik.

Nepal Bankers Association (NBA) took the decision following the consultations with majority of banks.

In the month of Ashoj, the banks had increased deposit interest rates to 12.13 percent, which had been opposed by business community. Given that hiked interest rates increased the cost of fund for the banks, they decided to keep it stable for the month of Kartik.

Raise in the deposit interest rate in Ashoj has increased cost of fund for the banks which has also increased the base rates.

At present, few banks have already recorded above 10 percent base rates. The base rates are likely to reach beyond 11 percent after Ashoj. The increased base rates will also pull up the interest rates of loans as the banks invest their funds by adding premium in base rates.