How Technology is transitioning NBFC | csl finance

1. 4/3/23, 4:28 PM HowTechnologyistransitioningNBFC CSLFinanceLtdAug10,20212minread HowTechnology istransitioningNBFC Finance, that has rightly been termed as ‘driving force of business’ is short in supply for many people-startups,smallfirmsandindividualsastheyarenotabletosatisfytoughconditionsset by the banks. Moreover, most public sector banks and some private banks have been gripped withbadloansforthelastfewyearsandithaspresentedatremendousopportunityforNBFCsto stepinwithitsofferingsandaimforgrowthandbusinesssuccess. ThecompaniesafterfulfillingNBFCincorporationprocedurehavewitnessedarobustgrowthrate astheycometotherescueofsuchpeopleandcompanies,especiallyinsmalltownsandremote areas,andgiventhemalifeline NBFCsarenowmorefocusedondevelopinginnovativeproductsandcateringtolow-income, urbancustomersinunorganisedsectors.Insuchascenario,NBFCsareadoptingbusinessand operational models powered by technologies that seamlessly facilitate the design, launch, implementationandexecutionoftailoredproductsandservices. RISEOFONLINENBFCs Withahighgrowthrateeveryyear,therearemanywaysinwhichtheinternethasaffectedthe financial services sector including the NBFCs in India. To differentiate their services and gain advantageovertherisingcompetition,theNon-BankingFinancialCompanies(NBFC)aretrying toprovidetheirservicesonlinetothecustomers.ThisisoneofthefactorsforwhichIndia’sNBFC sectorisexperiencingrapidly. https://www.cslfinance.in/post/how-technology-is-transitioning-nbfc

2. 4/3/23,4:28PM HowTechnologyistransitioningNBFC RISEOFONLINENBFCs Investing in new technologies and strategic partnerships with incumbent financial institutions andFinTechsallowsNBFCstolowertheircostswhenitcomestoincreasingtheircustomerbase, loweringcustomeracquisitioncosts,servicingexistingcustomersorde-riskingtheportfoliowhile tryingtoovercometheincreasingformalcreditpenetrationinagrowingeconomy. NBFCsareundergoingagreattechnologicalinnovationandrevolutiontodisrupthowfinancial serviceshavebeenmadeavailabletoindividuals,businessesandentrepreneurs.Bytakingthe helpofSoftware-as-a-service(SaaS)startups,NBFCsareadoptingnewertechnologyintotheir systems,especiallyinthelightofthegovernment’spushfordigitisation • ADVANTAGESOFONLINENBFCs • The new-age NBFCs are using technology like never before and harnessing partnership eco- systems across the value chain of lead generation, customer onboarding, credit or loan disbursementandcollectionwhilefacilitatingthedesign,launch,implementationandexecution ofservices. • Thekeyadvantagesofonline NBFCs are: • Branchlessoperationstoincreasereachinmarketandreductioninoperating cost • Dealerbasedsolutionhelpsinexpansionofbusiness • AutomatedEndtoEndloanmanagement • Analyticstofindcrosssellingandupsellingopportunities • Agilitytoquicklyaccommodatecustomer’srequirementsandcustomization • Conclusion: • TechnologyboostedNBFCbusinessmodelsthataimtolowerdependencyonmanual tasks and is built on the Robotic process automation, helps in broader inclusion, prowessincreditquality,cost-effectivenessandquickturnaroundtimeascompared tothetraditionallendingmodelsofbanks. https://www.cslfinance.in/post/how-technology-is-transitioning-nbfc