Hypothecation Loan

Hypothecation Loan

pledge loan differs from a standard loan in that the loaned amount is completely backed with collateral from the borrower. A borrower can use their funds, such as a savings account, as collateral to obtain a loan.

Hypothecation Loan
5 %
Interest Rate
Hypothecation Loan
7.53 %
Base Rate
Hypothecation Loan
12.53 %
Total Interest Rate

Last Updated Date: May 17, 2022

Agriculture Development Bank Ltd

Agriculture Development Bank Limited (ADBL) is a self-ruling association to a great extent possessed by the Government of Nepal. The bank has been functioning as a head provincial credit foundation throughout the previous thirty years, offering in excess of 67 percent of institutional credit gracefully in the nation. Subsequently, rustic money is the main operational territory of ADBL. Moreover, it has likewise been executing the Small Farmer Development Program (SFDP), the significant neediness mitigation program dispatched in the nation. Moreover, the bank has additionally been associated with business banking tasks since 1984. 


Agrarian Development Bank has a sum of 232 branches under the administration of 10 local workplaces and 60 ATMs (18 inside valley and 42 outside valley) sources.

Hypothecation Loan

REQUIRED DOCUMENTS

  • Photograph (2 copies each)
  • Citizenship and/or Passport
  • Bank (deposit & loan) account statement of at least 6 months
  • Firm/Company Registration Certificate (if applicable)
  • PAN/VAT Certificate (If applicable)

What is a Pledge Loan?

A pledge loan differs from a standard loan in that the loaned amount is completely backed with collateral from the borrower. It is a well known fact that the prices of agricultural commodities immediately after harvest, tend to be low compelling the farmers specially the small and marginal farmers with low or no holding capacity, to resort to distress sale. There has been a felt need to provide the farming community with pledge finance to enable the farmers to avail credit when the prices are low and to sell their produce when the prices are favorable. A borrower can use their funds, such as a savings account, as collateral to obtain a loan. pledge loans against the stock after verification of the same. The stock, however, is kept under lock and key of the Bank and the loan disbursed and settled in pro rata basis with the stock pledged and sold. The funds used as collateral then become "frozen" until the loan is paid back in full. Because pledge loans are fully backed with collateral, they are easier to obtain than traditional loans and offer a number of other benefits to borrowers such as:

  • Better interest rates than standard loans
  • No credit check required
  • Helps establish or rebuild credit history easily
  • Flexible terms

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