Class "A" licensed institution Functions - Banking Tayaari

 

Section 49 of BAFIA contains a category-wise detailed list of financial functions which a licensed institution can transact. Similarly, Section 50 explains the activities prohibited for being carried out by licensed institutions. If any. licensed institution contravenes these regulations in whatsoever manner, its license would be cancelled.

Class "A" licensed institution

A Class "A" licensed institution can carry on the following financial transactions subject to BFI Act and the memorandum of association and articles of association:

a) Accepting deposits with or without interest and repaying the deposits through various financial instruments;

b) Accepting deposits, making payments, having transactions, provide intermediary services and transfer funds through various electronic medium (devices & instruments). 

c) Disbursement of credit ( hire-purchase, leasing, overdrafts and housing); 

d) Disbursement of credit on project or hypothecation, collateral and disbursing and causing to be disbursed loans in consortium financing having divided the collateral on pari passu according to the agreement entered into between one another;

e) Disburse loans on the guarantee of foreign bank or BFI;

f) Disbursing loans within the value covered by the movable or immovable assets which has already been mortgaged to it or disbursing loans on remortgaged within the value covered by movable or immovable assets which has already been mortgaged to other bank or financial institution;

g) Issuing guarantees, getting executed necessary bonds such customers in consideration thereof, obtaining security, and acquire their movable or immovable assets as collateral or mortgage, or the assets of 3rd persons as collateral; 

h) Availing refinance from NRB as may be necessary or lending or providing loans from other bank or financial institution; 

i). Disbursing or managing loans from amount received from GoN or other agency for project promotion; 

j) Write off credits as per prevailing credits write off Byelaws; native or foreign

k) Issuing shares, debenture, bond and so on to meet the capital fund subject to the limitations, conditions or directives issued by the Rastra Bank. 

1) Issuing, accepting, paying, discounting or purchasing and selling letters of credit, bills of exchange, promissory notes, cheques, travelers cheques, drafts or other financial instruments; 

m) Issuing, accepting, managing digital card or other instruments for electronic transactions and appointing agencies to carry out acts relating thereto; 

n) Foreign currency transactions subject to the prevailing laws;

o) Carrying out government transactions subject to the limits, terms of NRB; 

p) Purchasing, selling or accepting bonds issued by NRB and GoN; and conditions or directives

q) Remitting or transmitting funds to different places within or outside Nepal and receive remittance from abroad to make payment thereof; 

r) Act as custodian in the sale or purchase of shares, debentures or securities; collecting interest etc and also arrange safe deposit vaults for customers acting as a commission agent of its customers;

s) Carrying or off-balance sheet transaction;

t) Disbursing credits within prescribed limit of NRB, against individual or collective guarantee, for the economic up-liftment of the deprived sector people, low-income families, victims of natural calamities and inhabitants in any area of the country;

u) Exchanging with NRB or any other BFI particulars of, information or notices on debtors or customers who have obtained credits from it or other banks or financial institutions; 

v) Buying and selling of gold and silver bullions;

w) Conduct, study, research and do survey work relating to the the establishment, operation and evaluation of projects and provide training, consultancy and other information; 

X) Prudently managing or selling its assets of all type to come under its ownership according to this Act and the prevailing laws;

y) As per the prevailing laws, giving guarantee with consent of the parties involved on matters of payment to be made or values to be recovered for performance of any act between two or more persons.

z), Carry out other functions as prescribed by the Rastra Bank.