Kathmandu. Cooperatives will not be allowed to charge more than 13 percent interest. Cooperatives will not be able to charge more than 13 percent interest rate after the cooperative department has fixed the interest rate of 13 percent.

Earlier, the reference interest rate of cooperatives was 16 percent. However, the cooperative department has reduced the reference interest rate by 3 percent to 13 percent.

The interest rate in respect of cooperatives reduced by the department will be applicable from September 17. With this, the cooperative will now have to analyze the situation and needs of the cooperative and fix the limit of the interest rate to be less than 13 percent.

Similarly, the department has also made a provision that if the cooperatives decide to take compensation, they cannot take more than 5 percent of the outstanding interest amount.

On the other hand, the department has also made a provision that the cooperatives will not be allowed to take additional money from the borrower under any heading, including administrative fees, service charges, renewal fees, form fees, etc. The department has directed the cooperatives to follow these provisions. The department has also warned that action will be taken if the rules are not followed.