A meeting of the Nepal Bankers Association, an umbrella organization of chief executive officers of commercial banks, has agreed to raise interest rates for the month of February.

Commercial banks have agreed to raise interest rates on deposits, citing growing shortage of liquidity in banks. The union said that despite the increase in demand for loans, the banks have not been able to collect deposits.

As per the decision of the association, it has been agreed to maintain the annual interest rate of 11.03 percent per annum for the individual. Earlier, the banks had agreed to offer 10.07 percent interest rate. Bankers will pay 10.3 percent interest on institutional deposits, 5 percent on savings accounts and 3.015 percent on calls.