Besides residential buildings, many buildings used for commercial purposes have sustained damage. Many hotels and lodges around the New Bus Park area and other places have been badly damaged. Under the scheme, the central bank provides refinance to banks and financial institutions (BFIs) at zero percent and the BFIs have to provide the loans to the individuals at 2 percent. The maximum amount to be extended to an individual is Rs2.5 million for Kathmandu valley, and Rs1.5million for places outside the valley.

NRB Spokesperson Min Bahadur Shrestha said only those victims who have no houses to live in would be eligible to get the loans. “Those who had given the damaged building in rent and stayed in another undamaged building won’t get this facility,” he said. He said if an owner has single house and has given some flats on rent for office purposes, will have to prove from the authority that his/her building has been damaged and is inhabitable.

To get the loan, one has to submit the evidence through government agencies concerned, municipalities or their ward offices and village development committees as per the guideline introduced by central bank.

The first year will be grace period, and the borrowers should not pay the instalment, but BFIs should collect the interest for that period later. The repayment period will be 5-10 years. If a damaged house was built by taking home loan, the repayment period has been extended to 15 years.

However, bankers have expressed doubts whether the scheme would be successful given many people who lost their houses have poor background.

“Banks don’t give loans to those who do not have the repayment capacity and enough collateral,” said Rajan Amatya, deputy general manager at Nepal Investment Bank. “How many poor households will benefit from this scheme as they don’t have enough collateral and regular income sources?”