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FAQ on BLA Loan Products

Who are eligible for BLA loan products?

Any Bhutanese residing overseas, with sufficient repayment capacity, are eligible to apply for BLA loans.

How can I apply for loan?

Applicants can email the duly filled forms, along with other required documents to [email protected]

Where can I access the loan forms and checklist?

You can download them from our website at www.bob.bt

Do I need to be physically present at the bank to execute the loan documents?

Applicants or guarantors (residing outside Bhutan) can assign Power of Attorney (POA) to family members who are residing in Bhutan, authorizing them to execute the documents on their behalf.

Do I need to mail the original loan forms and other documents?

Original documents should be mailed to CRM, Loan Section at Thimphu Main Branch, Bank of Bhutan.

What is the process for making loan repayments?

The loan repayment should be routed through BLA FC account.

Will bank accept income from multiple sources?

Multiple income sources of the applicant will be considered, including the income of immediate family members (spouse and children)

How much percentage of the income from abroad will be considered for loan repayment?

For permanent resident/green card holder, 50% of the monthly net income, and for temporary residents, 20% of the monthly net income will be considered for loan repayment.

HOUSING LOAN

For what purpose can I avail the housing loan for?

You can avail housing loan for following purposes:

  • For new residential or commercial construction (currently under moratorium until further confirmation from RMA).
  • For renovation of existing house/building
  • For purchase of property

What is the interest rate for housing loan?

The current floating interest rate for non-commercial housing is 8.13% per annum, and for commercial housing, it is 8.93% per annum.

What is the maximum loan tenure?

The maximum loan tenure is 30 years (360 months) excluding gestation period.

What is the gestation period permitted for housing loan?

The maximum allowed gestation is 3 years (36 months).

What is the limit ceiling for housing loan?

The maximum limit for non-commercial housing is Nu. 10.00 million, while there is no ceiling for commercial housing.

What is the quantum of loan?

  • Commercial housing loan: 80% of building estimates and 70% of building estimates which exceed Nu. 50.00 million.
  • Non-commercial (home) loan: 90% of building estimates.
  • For renovation: 50% of the renovation cost.
  • Takeover loan:  Loan Outstanding with other FIs.

Will I get housing loan to purchase property abroad?

No, BLA housing loan is exclusively available for the construction, renovation and purchase of properties within Bhutan.

Will the entire loan amount be disbursed in lump sum for the construction/renovation of a house?

The loan amount will not be disbursed in a lump sum; instead, it will be disbursed in tranches based on the progress of the construction. For purchase of property, it will be disbursed to seller’s CASA account.

For purchase of already constructed house, will Bank consider the sale deed value?

The bank may consider the sale deed value when calculating the loan amount, but the insurance value of the property must, at a minimum, equal the loan amount. When purchasing a home or building, it is advisable to confirm with the insurance company the maximum coverage limit for the property.

EDUCATION LOAN

Who can avail education loan?

Bhutanese individuals living abroad can avail education loan for advancing their studies or covering the educational costs of family members and relatives both within and outside Bhutan.

What is the interest rate for education loan?

The current floating interest rate is 8.13% per annum.

What is the maximum loan tenure?

The maximum loan tenure is 10 years (120 months) including gestation period.

What is the maximum gestation period permitted?

The maximum allowed gestation is 24 months.

What is the limit ceiling for education loan?

The maximum limit of Nu. 10.00 million for students studying in India or abroad and Nu. 1.50 million for students studying in Bhutan.

What is the quantum of loan?

70% of the value of the collateral or 90% of the cash collateral but not exceeding the maximum ceiling of Nu. 10.00 million.

If I have already paid the tuition fee, will I eligible for reimbursement?

Reimbursement of already incurred expenses is not permitted. Education loan will be given for pending tuition fees and will be remitted directly to the institution. Living expenses will be disbursed to the CASA account of the applicant.

Will the loan amount be transferred to my CASA account?

Except for the living expenses, tuition fees will be remitted directly to institution’s account.

Am I eligible for an education loan to support the educational expenses of both close family members and distant relatives?

Yes, as long as an individual has sufficient collateral and repayment capacity. However, the applicant will have to submit us the proof of relationship.

Do I need to provide collateral security even if I have adequate repayment capacity?

Yes, despite having adequate repayment capacity, individuals are required to provide collateral security.

Will Bank accept rural land as collateral for the loan?

The collateral offered should be within the areas falling under the bank’s rate. Rural land not included in the Bank’s rate will not be accepted.

Can I repay the interest during the gestation?

Interest accrued during the gestation period can be set aside from the approved limit, paid monthly, or settled in a lump sum at the end of the gestation period.

SHARE LOAN

What is the interest rate for share loan?

The current floating interest rate is 10.77% per annum.

What is the maximum loan tenure?

The maximum loan tenure is 10 years (120 months) for permanent resident/green card holder and 5 years (60 months) for temporary visa holder.

What is the maximum gestation period permitted?

There is no gestation period; repayment must commence immediately.

What is the quantum of loan?

Maximum of 50% of the market price.

Can I avail share loan to purchase shares of foreign companies?

The share loan is exclusively offered for the purchase of share of domestic companies listed with RSEBL with minimum 5 years of operations.

Can I avail share loan by pledging existing shares?

No, individuals cannot obtain a share loan by pledging existing shares. It is solely for the acquisition of new shares.

Do I need to provide collateral security to avail share loan?

Collateral security is not required. However, the shares acquired will be pledged with the bank.

BUSINESS LOAN

Who can avail Business Loan?

Bhutanese individuals living abroad who wish to establish a business in Bhutan can apply for a business loan.

What is the interest rate for business loan?

The interest rate is different depending on the type of business. Please visit our website www.bob.bt for interest details.

What is the maximum loan tenure?

The maximum loan tenure is 20 years (120 months) excluding gestation period.

What is the maximum gestation period permitted?

The maximum allowed gestation is 5 years (60 months)

What is the quantum of loan?

Maximum of 75% of the project cost.

Do I need to have a valid business license issued by MoEA to avail business loan?

Individuals applying for a business loan must possess a valid business license issued by MoEA.

Do I have to be in country to manage the business?

The business can be managed by a partner or family member(s) residing in Bhutan, whose details should be included in the DPR.