As the world's second-largest internet-using country, India's digital transformation in the financial sector is gaining momentum. According to the website Statista, in December 2021, NBFCs accounted for 36% of India’s lending landscape. With the rising popularity of embedded finance and digital lending, NBFCs in India are set to transform the financial ecosystem in the forthcoming years.
Full Form of NBFC in respect to financial sector is Non-banking Financial Companies. At present, India is brimming with new-age NBFCs that offer a plethora of financial services and products. As per Statista, nearly 9,860 NBFCs registered with the Reserve Bank of India in 2022.
NBFCs provide banking and other financial services without holding a banking license and are registered under the Company's Act of 1956. These companies engage in loans and advances, credit facilities, savings and investment products, and the acquisition of stocks, bonds, and shares. NBFCs offer credit to many sectors of the Indian economy, covering a wide range of unbanked sections of society and budding businesses.
In today’s financial landscape, NBFCs are playing an integral role by providing loans at affordable rates. The NBFC sector has also introduced new credit disbursal procedures to micro, small and medium enterprises (MSMEs). This contributes largely to the Indian economy and the overall financial system.
NBFCs can be classified into two broader categories based on their activity and the deposits they hold. Let’s look at them.
Digital lending has become one of the most promising financial services across India. High demand for comparatively smaller loans with easy, digital application processes by individuals and small and medium enterprises has widened the scope for NBFCs.
NBFCs have the business agility to serve various small and medium businesses faster as compared to traditional banks. Flexible payment plans, low-cost EMIs, and competitive interest rates are some of the top USPs of loan products offered by new-age NBFCs.
In addition to this, the rising adoption of artificial intelligence (AI) and blockchain-based financial services will further enhance the product portfolios of NBFCs in the future. The growing availability of internet and telecom services across villages, rural areas, and semi-urban areas is also creating a conducive environment for NBFCs.
Modern-day lending institutions are carving out their niche in the financial sector. With attractive financial products such as Personal Loans, Professional Loans, Business Loans, and Medical Equipment Loans, Poonawalla Fincorp is one of the leading NBFCs in India. Catering to your unique financial needs, we offer loans at competitive interest rates, minimal documentation, and quick disbursal through a seamless online application process.
Now that you know the full form of NBFC, its meaning, role, and features, you can always reach out to them to meet your financial goals.
Loans provide financial assistance, from necessities like medical expenses to buying a home to planning a vacation or luxuries like buying an expensive smartphone. We avail of loans for a variety of reasons.
Collateral-free loan refers to any loan that does not require any asset, security deposit or the backing of a guarantor. These are also called unsecured loans.