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NON BANKING FINANCIAL COMPANIES: GAME CHANGERS

NON BANKING FINANCIAL COMPANIES: GAME CHANGERS. Strictly Private & Confidential. Overview. Indian NBFCs accounted for 11.2 per cent of assets of the total financial system 12,385 NBFCs were registered in India, with total assets at $26 billion

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NON BANKING FINANCIAL COMPANIES: GAME CHANGERS

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  1. NON BANKING FINANCIAL COMPANIES: GAME CHANGERS Strictly Private & Confidential

  2. Overview • Indian NBFCs accounted for 11.2 per cent of assets of the total financial system • 12,385 NBFCs were registered in India, with total assets at $26 billion • Contribute for 47 per cent of retail banking (excluding housing loan) • NBFCs have become an important financial intermediaries particularly for the small-scale and retail sectors • NBFC boost competition and diversification in the financial sector by spreading risks during financial distress

  3. SURGE IN AUM OF RETAIL NBFCS ($ bn) Market Share in Retail Banking (%) Source : RBI

  4. Definition Section 45I of the Reserve Bank of India Act, 1934 defines ‘‘non-banking financial company’’ as– • A financial institution which is a company; • Non-banking institution which is a company and which has as its principal business the receiving of deposits, under any scheme or arrangement or in any other manner, or lending in any manner; • Such other non-banking institution or class of such institutions, as the Bank may, with the previous approval of the Central Government and by notification in the Official Gazette, specify.

  5. Types of NBFC • Equipment Leasing Company • Hire purchase finance company • Investment company • Loan company • Residuary Non-Banking company

  6. Types of NBFC • Equipment Leasing Company • Hire purchase finance company • Investment company • Loan company • Residuary Non-Banking company

  7. Role in Financial Inclusion • Successful in serving the unbanked customers by pioneering into retail asset-backed lending, lending against securities and microfinance • Aspires to emerge as a one-stop shop for all financial services • Bridging the gap left by banks in rural/semi-rural markets by providing reliable and affordable access to credit • Affordable Housing Finance to low income group

  8. Financial Performance of NBFCs (in INR bn.) Source : RBI

  9. Capital Adequacy Ratio – NBFCs - D Source : RBI

  10. Capital Adequacy Ratio – NBFCs – ND - SIs Source : RBI

  11. NPA Ratio Source : RBI

  12. Source : RBI

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