Finance Minister Janardan Sharma has urged microfinance institutions (MFIs) to reduce the current interest rate on their credit flow. Accepting the demand letter of the Microfinance Association of Nepal on Sunday, Minister Sharma stated that the living standards of the poor people will not change unless the MFIs reduced interest rates. Stating that he was ready for the support needed to reduce the interest rate fixed by the MFIs, Minister Sharma urged the representatives of the MFIs to come up with an action plan for the same. The delegation, however, said that it would not be possible to reduce the interest rate of microloans unless the commercial banks took the interest rates down. Commercial banks’ loan is the main financial resource for the MFIs. They informed that the microfinance institutions have been providing loans by adding only 2 percent on top of the interest rate charged by the commercial banks. As of last July, there are 70 microfinance institutions in Nepal. Of these, 48 are national-level companies and 22 functioning as local level institutions. About Rs. 39.92 billion is invested in MFIs. With a deposit of over Rs 130.42 billion, microfinance institutions have invested Rs. 365 billion in loans.