Political Factor

According to the Fiscal Incentives Acts of Bhutan 2021, there is a tax exemption on the interest
income from preferential lending as approved by the Royal Monetary Authority of Bhutan for
education, skills development, and overseas employment.

Other incentives under the approval of the ministry, ST and CD exemption on electronic cash
registers and point of sale (PoS) machines for business entities and ATMs for financial
institutions. (Parliament of Bhutan, 2021)

Economic Factors

The RMA reduced the Cash Reserve Ratio from 10% to 7% to provide immediate liquidity relief
in the financial sector.

To overcome the immediate impact of COVID-19 50% loan interest payment support was
granted by the Financial Service Providers (Royal Monetary Authority of Bhutan, 2021)

Technological Factors

To harness the benefits of evolving technology, the RMA is considering the development of
Central Bank Digital Currency (CBDC) which would have far-reaching positive impacts on the
financial service providers.

Legal Factors

Principal 2 of Consumer Protection for Financial Services Rules and Regulations 2019
promotes the inclusion of appropriate mechanisms to ensure fair and equitable treatment to
customers (Consumer Protection for Financial Services (CPFS) Rules and Regulations 2019,
2019).