Kathmandu. The Stock Investors Association has submitted a five-point suggestion to make the monetary policy for the coming fiscal year 2083/84 capital market-friendly{{}. The association has proposed various policy reforms with the objective of making the capital market more competitive, deep, liquid and investment-friendly. 

The Association has urged the Monetary Policy to provide additional policy freedom to banks and financial institutions to invest in the secondary market, to review the provisions related to and to encourage institutions with sufficient capital, liquidity and risk management capacity to invest in the stock market in a prudent manner ।

Similarly, the association has also suggested to improve the provision related to dividend distribution of microfinance institutions, to transform share mortgage loans into a risk-based system and to ensure easy access and investment return environment for Non-Resident Nepalese (NRN)।

The association has also demanded the government to make necessary policy arrangements to mobilize the long-term fund of Employees Provident Fund, Social Security Fund and insurance companies more actively on the basis of clear risk management criteria.

The active participation of such institutional investors will enhance the long-term stability, liquidity and confidence of theinvestors. He believes that the implementation of the suggestions presented by the Association would deepen the capital market, attract institutional investors, strengthen investors’ confidence and contribute positively to the stability of the overall financial system.

Here are the five major suggestions submitted by the Association:

1. Provide additional policy flexibility to banks and financial institutions (BFIs) regarding investment in secondary markets.

2. To improve the provision relating to dividend distribution of microfinance institutions.

3. To make the share mortgage loan system risk-based.

4. To make the process of investment entry and return of investment easier for Non-Resident Nepalis.

5. To make policy facilitation for the active mobilization of institutional long-term funds.