In 2005 the Nepali government and the Asian Development Bank approached LFS to assess the SME situation in the country. LFS’ task was to estimate the feasibility of a commercial SME lending approach in Nepal’s commercial banks and give recommendations on its execution. As a result, LFS deemed a unit approach to be the most promising.
In a subsequent report LFS gave recommendations to the Nepali government and central bank on the conceptualisation of a suitable regulatory framework for a commercial MSE lending project, in line with the needs of both banks and clients. In addition commercial banks and the aforementioned parties were made aware of the main issues and opportunities of downscaling.