What is the interest rate of pension loan in Nepal?

Pension loan interest rates in Nepal generally range from 8.25% to 10.50% per annum, depending on the bank, loan tenure, and pension amount. Nepal Bank Limited typically offers rates around 8.25%–9.25%, Rastriya Banijya Bank around 8.50%–9.50%, and Agricultural Development Bank around 9.00%–10.50%. Rates may change as per Nepal Rastra Bank guidelines.

Who is eligible for a pension loan in Nepal?

Pension loans in Nepal are mainly available to retired government employees and pensioners who receive a regular pension through a bank account. Eligibility also depends on age limits at loan maturity and the remaining pension period, as defined by individual banks.

What documents are required to apply for a pension loan?

To apply for a pension loan, banks usually require a citizenship certificate, pension certificate or pension slip, recent bank statement showing pension credit, and passport-size photographs. Additional documents may be requested depending on the bank’s policy.

How much loan amount can a pensioner get?

The pension loan amount depends on the pensioner’s monthly pension income, remaining pension tenure, and age. Most banks provide loan amounts based on a multiple of the monthly pension, subject to repayment capacity.

Is a pension loan cheaper than a personal loan?

Yes, pension loans are generally cheaper than personal loans because they are backed by a regular pension income. This lower risk allows banks to offer pension loans at comparatively lower interest rates.

Pension Loan Interest Rates in Nepal

A pension loan is a secured loan facility offered by banks in Nepal to retired government employees and pension holders. Since the loan is backed by a regular pension income, pension loans generally come with lower interest rates, longer tenure, and simpler eligibility criteria compared to personal loans. Pensioners can use this loan to meet medical expenses, household needs, or other personal requirements without financial stress.

Pensioner Loan

Everest Bank Limited

Bankrate Nepal Review

N.A

Interest Rate(P.A) As of January 25

6.46% - 8.46%

Processing Fee

N.A

Tenure

Pensioner Loan

Nepal Bank Limited

Bankrate Nepal Review

N.A

Interest Rate(P.A) As of January 25

8.96% - 9.96%

Processing Fee

N.A

Tenure

Pensioner Loan

Nepal SBI Bank Limited

Bankrate Nepal Review

N.A

Interest Rate(P.A) As of January 25

8.85% - 10.85%

Processing Fee

N.A

Tenure

Pensioner Loan

Rastriya Banijya Bank Limited

Bankrate Nepal Review

N.A

Interest Rate(P.A) As of January 25

7.28% - 7.28%

Processing Fee

N.A

Tenure

Pension Loan Eligibility in Nepal

Pension loan eligibility in Nepal is primarily based on a pensioner’s regular pension income and age. Most banks provide pension loans to retired government employees who receive their pension through a bank account. Eligibility criteria may also include a maximum age limit at loan maturity, minimum remaining pension period, and satisfactory repayment capacity. Specific requirements can vary from one bank to another as per internal credit policies.

Frequently Asked Questions (FAQs)

Pension loan interest rates in Nepal typically range between 8.25% to 10.50% per annum, depending on the bank, loan amount, and tenure.
Indicative rates from major banks are:

Nepal Bank Limited: around 8.25% – 9.25%
Rastriya Banijya Bank: around 8.50% – 9.50%
Agricultural Development Bank: around 9.00% – 10.50%

Note: Rates are subject to change as per Nepal Rastra Bank guidelines and individual bank policies.

Pension loans are generally available to:

Retired government employees
Pensioners receiving regular pension through a bank account
Individuals within the bank’s maximum age limit at loan maturity
Some banks may also require a minimum remaining pension period.

Commonly required documents include:

Recent passport-size photographs Additional documents may be requested based on bank policy.

Citizenship certificate

Pension certificate or pension slip

Bank statement showing pension credit

The loan amount usually depends on:

Monthly pension income
Remaining pension tenure
Age of the pensioner

Most banks offer pension loans up to a fixed multiple of the monthly pension amount, subject to repayment capacity.

Yes. Pension loans usually have lower interest rates than personal loans because they are secured against a stable pension income, making them less risky for banks.