Commercial Bank Deposit & FD Interest Rates in Nepal (July–August 2026 Update)

Nepal's commercial banks have cut deposit interest rates again for the period of July 17 to August 16, 2026, as excess liquidity in the banking system continues to build and loan demand stays weak. If you're deciding where to park a fixed deposit or wondering why your savings account interest keeps shrinking, here's exactly what changed, which banks moved, and what it means for your money.

Why Banks Are Cutting Deposit Rates

The short answer is simple: banks have far more deposits than they can profitably lend out. During fiscal year 2025/26, total deposits in the banking system grew by roughly Rs 1,000 billion, while credit expanded by only about Rs 400 billion. That gap left commercial banks holding well over Rs 1,320 billion in excess, lendable funds parked with Nepal Rastra Bank (NRB) rather than out on loan. Since idle deposits still cost banks interest, the only way to reduce that cost is to lower the rate they pay depositors — which is exactly what has been happening, month after month, through most of 2026.

Because NRB's monetary policy prevents banks from cutting regular savings rates below its 2.75% policy floor, banks have instead concentrated their cuts on individual fixed deposit rates, where they have more room to maneuver.

Which Banks Cut Rates vs Which Kept Them Unchanged

For the July 17 – August 16, 2026 period, six major banks reduced their maximum individual fixed deposit rates to lower their funding costs: NMB Bank, Kumari Bank, Standard Chartered Bank Nepal, Citizens Bank International, Global IME Bank, and Rastriya Banijya Bank. The remaining 14 commercial banks held their rates steady for the month. Among the cuts, Rastriya Banijya Bank trimmed its personal deposit rate by the largest margin (0.75 percentage points), followed by Global IME Bank (0.5 points), NMB Bank (0.25 points), Citizens Bank International (0.15 points), Standard Chartered (0.1 points), and Kumari Bank (0.06 points).

Current Savings Account Rates by Bank

Regular savings rates remain relatively stable across the sector because of NRB's 2.75% floor, but banks still differentiate through premium/digital savings products offering slightly higher rates for higher minimum balances. Rather than quoting numbers that will already be outdated by the time you read this, the most reliable approach is to check each bank's published rate sheet directly — nearly every commercial bank now publishes its current savings and FD rates on its official website, updated at the start of each Nepali month.

Current FD Rates by Tenure

Most banks offer tiered fixed deposit rates across 3-month, 6-month, 1-year, and multi-year tenures, with longer tenures generally (though not always) commanding a modest premium. For the July–August 2026 cycle, Nabil Bank and Prabhu Bank continued to post some of the highest maximum individual FD rates in the sector, while Kumari Bank and Standard Chartered Bank Nepal were among the lowest after their latest cuts. Institutional/corporate FD rates and remittance-linked deposit rates are typically priced about one percentage point higher than standard personal FD rates across almost all banks.

What Falling Rates Mean for Depositors

For ordinary savers, the practical impact is straightforward: the same amount of money now earns noticeably less interest than it did a year ago. A depositor holding Rs 10 lakh in a 1-year FD at 4.17% earns roughly Rs 4,170 less per year than at 4.6%. For pensioners and others relying on FD interest as regular income, this is a meaningful squeeze, and it's pushing some savers to explore alternatives like mutual funds, government savings bonds, or NEPSE-listed shares for a portion of their savings — though each of these carries very different risk profiles compared to a bank FD.

Should You Lock In a Long-Term FD Now?

This is ultimately a personal financial decision that depends on your liquidity needs, risk tolerance, and view on where rates go next — and it isn't something we can decide for you. What we can say factually: rates have been on a sustained downward path through 2026 due to structural excess liquidity, and most analysts expect this liquidity glut to persist at least through the first half of fiscal year 2026/27 unless credit demand recovers meaningfully. Locking a longer tenure now protects you from further near-term cuts, but it also means missing out if rates eventually rebound. If you're unsure, laddering — splitting your deposit across multiple tenures — is a commonly used approach to balance both scenarios. This is general information, not personalized financial advice; consider speaking with a licensed financial advisor for decisions specific to your situation.

Frequently Asked Questions

Why did FD rates fall for July–August 2026?

Banks are sitting on more than Rs 1,300 billion in excess liquidity because deposit growth has far outpaced loan growth in FY 2025/26. To cut funding costs, six major banks lowered their fixed deposit rates for this period.

Which bank had the biggest rate cut?

Rastriya Banijya Bank made the largest cut among the six banks that reduced rates, trimming its individual deposit rate by 0.75 percentage points.

Will FD rates keep falling?

As long as loan demand stays weak and deposits keep growing faster than credit, downward pressure on rates is likely to continue, though the pace of cuts may slow. This depends on evolving economic conditions and NRB policy, so it's worth monitoring monthly rate updates.

Is a lower savings rate the same as a lower FD rate?

No. NRB prevents banks from cutting regular savings rates below a 2.75% floor, so most of the recent rate-cutting activity has been concentrated in fixed deposit products rather than savings accounts.