The 10 most admired non banking financial companies in 2018

™
Empowering Students to Aspire Without Boundaries
THE
10Most
ADMIRED
NON
BANKING
FINANCIAL COMPANIES
IN 2018
Amit Gainda, CEO
Chalk Talk
Participation of
Non-Banking Financial
Companies in the
Economic Development
Editor’s View
The Revival of
Non-Banking
Financial
Companies.
JUNE 2018
www.insightssuccess.in

BFCs have come to be regarded as important financial intermediaries
Nparticularly for the small-scale and retail sectors with the growing
importance assigned to financial inclusion. In the multi-tier financial
system of India, the importance of NBFCs is much discussed by various
committees. They are basically engaged in the business of loans and advances,
acquisition of shares/stocks/bonds/debentures/securities issued by government or
local authority or other securities of like marketable nature, leasing, hire-
purchase, insurance business, chit business but does not include any institution
whose principal business is that of agricultural activity or any industrial activity
or sale, purchase or construction of immovable property.
NBFCs are an integral part of the Indian financial system, enhancing competition
and diversification in the financial sector, spreading risks specifically at times of
financial distress and have been increasingly recognized as complementary of
banking system at competitive prices.
NBFCs usually define securities that can be pledged against the loan. These
securities are very liquid, from high quality companies, and highly valued
securities. The amount depends on the valuation of securities, margin allowed by
the NBFC, and past credit history. The amount of loan is about 50% to 70% of
the value of the securities pledged with the NBFC. Hence, if the stock portfolio
for these securities is 10 lakh, one can get a loan of 5 lakh to 7 lakh against the
stock portfolio. The advantage of loan against securities is that one will be
charged interest only on the amount withdrawn from the account and for the span
of time the fund is utilized. The other advantage is that no personal guarantor is
required for loan against securities.
NBFCs have been playing a very important role both from the macro-economic
perspective and the structure of the Indian financial system. NBFCs are the
perfect or even better alternatives to the conventional Banks for meeting various
financial requirements of a business enterprise. They offer quick and efficient
services without making one to go through the complex rigmarole of
conventional banking formalities. However to survive and to constantly grow,
NBFCs have to focus on their core strengths while improving on weaknesses.
They will have to be very dynamic and constantly endeavor to search for new
products and services in order to survive in this ever competitive financial
market.
Editorial
NBFCs-
Channelizing
the Financial
Resources
in Capital
Formation
Shweta Priyadarshini
Shweta Priyadarshini

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Contributors
June, 2018
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Executive Editor Shweta Priyadarshini

Editor’s view
The Revival of Non-Banking
Financial Companies
32
42
22
Chalk Talk
Participation of Non-Banking
Financial Companies in the
Economic Development
08
AVANSE
CoverStory
Empowering Students to
Aspire Without Boundaries
The Economic
Stature
The Stature of Non-Banking
Financial Companies
AVANSE
Articles
CXO Standpoint
FINANCIAL TALK
Arising with the Financial
Technology Ecosystem
46
Experts View
All About TDS On
Property Purchase
18

Creating Benchmarks
in the Commercial
Vehicle Finance Sector
16
Light
Microfinance
Empowering Rural &
Semi-Urban Entrepreneurs
Through Innovative
Financial Services
26
Jagaran Microfin
Delivering Best-in-
class Financial Services
24
Margdarshak
Driving Financial
Inclusion for
Equitable Growth
30
SAFL
India’s First Dedicated
Agriculture Loan Company
36
SV Creditline
Transforming the
Face of Rural India
with Comprehensive
Services
38
Shikhar
Microfinance
A microfinance
with a difference
44
Aris Capital

on-Banking Financial Companies have emerged in various fields and are playing significant roles in the Indian
Neconomy. It is contributing to sustain economy and their role as productive intermediaries has been well
recognized and acknowledged. They have expanded in every possible ways across the country and have
13,000 members registered with them. Nearly 600 NBFCs receive public deposits and the finances assets worth 15000
crores annually. NBFCs have set an impact for financial incorporation, micro finance, reasonable housing, vehicle
finance, gold loans and infrastructure finance. These financial institutions have become more effective and grow in their
business by introducing personalized products, leverage consumer data, design and launch tailored products, reach &
expand savvy customer base efficiently, acquire new customers, save costs with digital organization.
In Insights Success Magazine, we have introduced The 10 Most Admired Non-Banking Financial Companies in
2018, in order to assist businesses to choose their right Non-Banking Financial Providers. Assessing the scenario in
versatile perceptions our magazine has brought into light the companies, who have flaunted some excellent Non-
Banking Financial Providers. This examined list will lessen the search of organizations that have perfect non-banking
companies.
In this issue, we have specially featured Avanse Financial Services Limited, as cover story. Avanse Financial Services
Limited is one of India's fastest growing education finance company committed to facilitating and fulfilling academic
dreamsoftalentedyoungstudents.
We have listed Aris Capital that provides financing for commercial vehicles in the transport and agricultural industry.
JagaranMicrofin Private Limited that is a subsidiary of GTFS Multi Services Limited providing a wide range of financial
services, especially in the backward and rural areas. Light Microfinance which is a private limited company registered as a
non-banking finance company (NBFC) with the Reserve Bank of India and delivering micro finance products and services
to the world. Margdarshak Financial Services Ltd a non-banking financial company is providing financial services for
livelihood strengthening and economic mainstreaming of poor in the States of Uttar Pradesh, Bihar, Haryana and Himachal
Pradesh. Sustainable Agro-commercial Finance Ltd is the first NBFC in India providing agri- loans with a wide and
diverse range of financing options for almost every need of agricultural activity. Shikhar Microfinance Pvt. Ltd is a non-
deposit taking non-banking finance company. It empowers communities by providing financial services and livelihood
opportunities to the underprivileged segments of our society. SVCL is one of the largest non-banking financial companies
inIndiawhichaimstotransformtheruralsectorsofIndia.
We also have TVS Credit Services Ltd. which commands a strong presence in manufacturing of two-wheelers, auto
components and computer peripherals and Aditya Birla Finance Limited is among the leading well-diversified
financial services company in India offering end-to-end lending, financing and wealth management solutions to a
diversified range of customers across the country.
Our in-house editors have come up with some adroitly written articles such as Participation of non-banking financial
companies in the economic development.
Also, we have included articles like All About TDS on Property Purchase written by Abhishek Ranjan Singh, and
Financial Services written by Rajesh Nair.
An Integral Part of the Indian Financial
System, Enhancing Competition and
Diversication in the Financial Sector
The
10MostAdmired
NON BANKING
FinancialCompaniesin2018
Rs
Rs
Rs

EMPOWERING STUDENTS TO
ASPIRE WITHOUT BOUNDARIES
AVANSE
Cover Story
The
10MostAdmired
NON BANKING
Rs
Rs
Rs

uality education forms the
Qbedrock of sustainable
development of any country.
As India gears to become the
workforce powerhouse of the world,
enabling structures need to be put in
place that ensures world class
education for all in the country. Every
Indian youth has a right to the best in
education. And lack of funds must be
the last hindrance to this dream.
Avanse Financial Services, a Non-
Banking Finance Company (NBFC),
regulated by the Reserve Bank of India
and envisioned with the aim to fulfill
the need for education finance at
reasonable terms.
Avanse is an extract of the French
word for advance. And that's what
Avanse, a new age education finance
company. Avanse is a sensitive,
advanced private finance company
specializing in the niche space of
education. Our mother company DHFL
is one of India's largest housing finance
companies in the private sector, having
helped hundreds of thousands of
Indians to fulfill their dreams of
owning a home. Avanse is from that
pedigree. Avanse provides financial
assistance through Avanse standalone
offices and also through the DHFL
network offices. The Company funds
students travelling to all key
international advanced education
destinations including US, UK,
Australia etc. The endeavor always has
been to bring the best in financing
flexibilities to the Indian student
market. Avanse started of small and
their intention is not to compete in the
existing market but create new curves
of evolution. Their brand complements
the education sector and engages with
students and educators to
metamorphose financial solutions that
are new age and tailored for specific
needs.
The Forerunner
Mr. Amit Gainda, CEO of Avanse
Financial Services is an accomplished
leader with over two decades of
experience in the banking and financial
services industry. Amit deep
experience in building businesses from
an inception stage, sharp insights in
managing complexities of scale and
expertise in steering business strategies
across various lending portfolios with a
focus on ensuring sustained financial
performance. Led by his strategic
guidance and supported by an able
team, Avanse is well poised to further
strengthen its position in the education
finance segment.
In his earlier role at DHFL, Amit was
responsible for managing the SME &
Mortgage Loans Assets with
comprehensive responsibility across
various functional domains of Sales,
Product, Credit, and Risk &
Collections.
Prior to DHFL, he has worked with
Bajaj Finance, GE Money and
Citigroup. He is also a Certified Six
Sigma Black Belt in the DMAIC
methodology.
He has been part of several programs
and capability building projects which
have enabled him to contribute and
won accolades “Certified Global
Mortgage Leader” -GE Stamford,
“Certified Black Belt Project ‘Project
Write Rate’- Improved operating
efficiencies for Mortgages” and
“Certified Black Belt Project - ‘Project
Catch’m Young’- Focused on
delivering collections efficiencies” in
his previous assignments. He holds a
degree in Finance Management from
IMT Ghaziabad and a Marketing and
Finance post graduate diploma from
IMI Delhi. He has also completed an
Executive Education program in
general management from INSEAD,
Singapore and France.
About this Promising Company
Headquartered in Mumbai, Avanse is
one of India’s fastest growing
education finance company,
incorporated in 2013 with a socio-
economic objective of making better
education affordable to the masses in
India. Avanse is committed to
facilitating and fulfilling academic
dreams of talented young students.
Avanse is an NBFC arm of Wadhwan
Global Capital Private Limited
(WGC), a diversified financial services
conglomerate with an AUM of USD
~22 billion and presence across
lending, insurance, protection and
strategic investments. Avanse is an
associate company of DHFL, which is
the flagship company of WGC and a
leading financial institution in India.
The International Finance Corporation
(IFC), an arm of the World Bank is a
key stakeholder with 15% equity stake
in Avanse.
Distinctive Services
In the education finance domain,
Avanse provides loans across two
categories:
• Education Loan (B2C) – With its
new age, flexible and tailored
educational financial solutions,
Avanse makes higher education
affordable and accessible to Indian
students and young professionals,
thus, enabling them to ‘Aspire
without Boundaries’. Avanse has
fulfilled higher education dreams of
over 10,000+ students across 6000+
courses in 45+ countries. Avanse
has recently extended its solutions
to help parents fund their child's
school fees
· Educational Institutional Loan

To be a
Leading
Customer
Centric
Diversified
NBFCfocused
on Profitable
GROWTH
acrossdomainsof Consumer, MSME and Commercial
Businesses
with leadership
positionin Education Loans

(B2B) – Under this category, Avanse provides loans for
financing working and growth capital of educational
institutes which is requires for their infrastructure
expansion
Avanse’s Strategy to Overcome Initial Hiccups
The overall education loan market is dominated by PSU
banks. According to study by credit bureau Transunion
Cibil ~9% of the education loans disbursed by banks have
turned into non-performing assets. This challenge was an
opportunity for Avanse to quickly establish as a new age,
agile player and break through this competitive market
while also ensuring quality of business and lower defaults
rates. To ensure this, Avanse has undertaken several
successful initiatives. Avanse has been at the forefront of
creating great value and customizable solutions for
customers. To keep defaults low, Avanse has built strong
underwriting processes through a well-defined scorecard
model by opting for a student led approach. Avanse focuses
on the right student profile by incorporating employability
potential, co-borrowers credit profile, pedigree of the
Institute and the course.
Delivering the Class of Business
Avanse has been at the forefront of creating great value for
customers by offering features including 100% Funding,
Funding beyond tuition fees (covering visa, travel and stay
expenses), instant sanctions for select programs and
universities and loans without any limit. Avanse has
successfully transitioned from “mortgage/collateral driven”
education loan to “student led approach” whereby student
academics and future employability is taken into
consideration for granting loan. Avanse has created
customized solution for students based on the country and
program of choice. Unlike most financial lenders, Avanse
has also funded many unconventional and new age
education programs.
Digital and Technology are the critical growth enablers for
Avanse across all its businesses. Avanse is enhancing its
operational capabilities and processes with an aim to
improve customer experience and enhance productivity
through technology. Some of the key initiatives include:
· Straight through Loan processing with automated score
cards
· Artificial Intelligence allowing loans to ‘New to Credit’
customers allowing financial access
· Digitization of systems and processes
Role of Avanse’s Employees in Its Success
Avanse considers its talented employees as its greatest asset
in its journey towards success. Avanse has a team of over
250+ talented employees guided by a diverse leadership
team with a cumulative 200+ years of experience across
leading financial services organizations. The company's
growth has been phenomenal with a CAGR of over 150 %
over the last 4 years. Avanse has funded over 10,000+
students across 6000+ courses in 1900+ institutes across
India and over 45+ countries. Avanse has over 400
partnerships with educational counselors across the country
and has funded over 175 institutions covering over 5 lakh
students. Avanse is building an organization with a culture
based on Governance, Transparency, Meritocracy,
Inclusivity and Happiness Quotient. Avanse aspires to build
a great company which people can look upto in years to
come.
Driving Towards Future Goals
One of the largest Education Loan NBFCs in India today,
Avanse has embarked on a journey of transforming from an
education focused NBFC to a leading Customer Centric
Diversified NBFC focused on Profitable Growth across
domains of Consumer, MSME and Commercial Businesses.
While Avanse will focus on a profitable growth across these
sectors, it will however maintain its leadership position in
the Education Finance space. Avanse is expanding its reach
across the country and will be scaling up in new segments
like school fee funding and funding of a wider range of
educational programs. Technology will continue to be a
critical enabler across all the businesses.
Advice for the Budding Startups in the Industry
India offers tremendous opportunity to individuals who
have a strong belief in their entrepreneurial idea and are
willing to work towards its successful execution. The
crucial aspect of any business is the value one can create for
customers without chasing only the top line growth. Initial
capital burn is a necessary aspect of business but a
successful business is only that which is self-sustaining.
Entry barriers for most businesses are low today and
therefore strong customers relationships are not only a great
guard against competitive activity but also ensure long term
viability and profitability of the business.

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ManagementCompany Name
Avanse
avanse.com
Amit Gainda
CEO
Avanse Financial Services Limited is one of India’s fastest
growing education finance company committed to facilitating
and fulfilling academic dreams of talented young students.
Aditya Birla
Finance Limited
adityabirlacapital.com
Venkatraman G
CEO
Aditya Birla Finance Limited is among the leading well-
diversified financial services company in India offering end-to-
end lending, financing and wealth management solutions to a
diversified range of customers across the country.
Aris Capital
ariscapital.in
Harsh Poddar
Executive Director
Jagaran Microfin Pvt Ltd
jagaranmf.com
Jayanta Majumdar
MD
JagaranMicrofin Private Limited is a subsidiary of GTFS Multi
Services Limited providing a wide range of financial services,
especially in the backward and rural areas.
Margdarshak Financial
Services
margdarshak.org.in
Rahul J. Mittra
Founder & CEO
Margdarshak Financial Services Ltd a non-banking financial
company is providing financial services for livelihood
strengthening and economic mainstreaming of poor in the States
of Uttar Pradesh, Bihar, Haryana and Himachal Pradesh.
SAFL
safl.in
Arvind Sonmale
MD & CEO
Sustainable Agro-commercial Finance Ltd. (SAFL) is the first
NBFC in India providing Agri- loans with a wide and diverse range
of financing options for almost every need of agricultural activity.
Shikhar Microfinance
shikharfin.com
Satyavir Chakrapani
MD & CEO
Shikhar Microfinance Pvt. Ltd is a non-deposit taking non-
banking finance company. It empowers communities by
providing financial services and livelihood opportunities to the
underprivileged segments of our society.
SV Creditline
svcl.in
Rakesh Dubey
CEO
TVS Credit
Services Ltd
tvscredit.com
Ajay Srinivasan
CEO
have TVS Credit Services Ltd. which commands a strong
presence in manufacturing of two-wheelers, auto components
and computer peripherals
Aris Capital, a fast-growing Non-Banking Financial
Corporation that focuses on commercial vehicle financing. From
light, medium, and heavy commercial vehicle to used and new
tractors, the organization stands out to be an expert in lending to
retail borrowers in the logistics industry.
SVCL is one of the largest non-banking financial companies in
India which aims to transform the rural sectors of India.
Light Microfinance
lightmicrofinance.com
Rakesh Kumar
CEO
Light Microfinance aims to become the leading Microfinance
products and services provider in India. Light is managed by a
passionate, high integrity dynamic team of professionals with a
keen focus on tech-enabled delivery of extremely relevant
products in a cost-effective and risk-managed manner.
Brief
The
10MostAdmired
NON BANKING
Rs
Rs
Rs

ver the last few years, the role of Non Bank Finance Companies in India has only been increasing in reaching out to
Oand servicing the hundreds of millions of unbanked and difficult to reach rural and semi-rural populations. The
importance of local financing is continuing to grow in developing economies and emerging markets. Here let us
introduce Aris Capital, a fast-growing Non-Banking Financial Corporation that focuses on commercial vehicle financing.
From light, medium, and heavy commercial vehicle to used and new tractors, the organization stands out to be an expert in
lending to retail borrowers in the logistics industry.
Aris follows a robust data-driven credit assessment process that takes into account not only the borrower’s creditworthiness,
but also factors like work experience, market conditions, and the philosophy of “The Bhodrolok Culture” where Harsh
Poddar, Executive Director at Aris Capital, explains, “We are respected people and we provide loans to people who are
perceived to be with a good character.”
An Ardent and an Efficient Leader
Harsh completed his MBA from Yale University, where he was a Silver Scholar, and has a BSE degree in Engineering and
Economics from Duke University. Along with an exceptional academic background, Harsh has also studied Mandarin
Chinese at the Beijing Language and Culture University. Entrepreneurship was not just another word in his dictionary. For
him, its passion, and that is what ignited him to give foundation to several companies in the USA, Israel, India and China in
diverse sectors such as IT, Shipping, Semiconductors, Environmental Engineering, Finance and Oil & Gas.
ARIS CAPITAL
An Expert in Providing
Commercial Vehicle Finance
Harsh V. Poddar
Executive Director
June 201816
™

The
10MostAdmired
NON BANKING
Rs
Rs
Rs
Understanding and Improving
Customer Service
The organization not only follows
“Bhodrolok Culture” in its business
process, but also applies that in its
recruitment process. Even after being
in the financial service sector, the
company follows a strict hiring policy
and cautiously selects its employees. In
this business, clients typically come
from low-income households who have
limited access to formal sources of
financing and whose livelihood is
directly dependent on the vehicle. The
staff of Aris Capital reaches out to
every such person who is aiming to
start a livelihood by driving a
commercial vehicle but is not getting
that financial support.
With an aim to create awareness
among the economically poor yet
hardworking people, Aris Capital
reaches out to chai stalls, dhabas
(roadside food stall), garages, and
truck stops and guides them on the
banking and other financial services
that they could avail to grow their
business. The staff goes through
numerous stages and enquires every
detail and gives every effort to
understand the person who is looking
for financial support. Harsh says that
“We understand whether the person
can benefit from and repay the loan.
We also guide them to repay with
honesty.”
Establishing Symbolic Relationship
with Unique Strategies
Growing number of markets are
becoming extremely competitive, and
clients are having an ever-widening
choice of financial service providers to
choose from. With the vast majority of
NBFCs functionally confined to
offering short-term credit products, the
clients are effectively given the option
of staying with or leaving their current
service provider at the end of every
loan cycle. Aris Capital stands out by
maintaining a direct relationship with
the customers where other companies
use brokers to find customers who
want to take a loan, and they pass on
the credit to financiers.
“We don’t believe in brokers; we are a
company which does direct lending to
customers,” says Harsh.
The organization believes in the
importance of educating clients and
responds to their questions. It also
obtains other critical information that
can be fed into future marketing
activities. This is particularly important
in a competitive market where clients
have a large number of choices and
therefore want to ask many questions
about the service before finally
choosing which NBFC to use. Aris
Capital believes in developing long-
term relationships with its customers
and wishes to support their financial
growth over many years.
Conducting Awareness Programs for
the Customers
Mostly in rural areas, customers are
unaware of the specific terms and
conditions, which are required for them
to conduct the loan re-payment
process. Aris Capital tries to educate its
customers by conducting customer-
relationship programs and educative
events. Through this process, the
customers are enlightened about the
entire payment criteria and process.
The employees of the company make
sure that they meet their customers
frequently, hence maintaining a long-
term relationship with the customer
and creating a bond of understanding
and trust.
Values and Factors Attributing to
Success
With the growth of technology-based
opportunities, the company has grown
manifold. To enhance service standards
and delivery processes, the
organization believes that Speed,
Energy, and Flexibility are required to
build and expand. Aris strives to
inculcate mobile banking habits among
its customers and field staff using
smartphone technology and
customized, easy-to-use apps to greatly
improve the speed and efficiency of
financial transactions.
An Entrepreneur’s Advice to the
Youngsters
Harsh Poddar states that there is never
a perfect time to start something new.
He further states that success and
failure are part of life and business, but
what is more important are the
ambition and will to succeed. It is the
unwavering commitment to their vision
and a passion for their work that are
critical components of an
entrepreneur’s value proposition.
Expanding and Securing the
Organization
Aris Capital provides diversified
financing of vehicles such as
commercial cargo vehicles, passenger
commercial vehicles, tractors, and
buses. With local branches in various
regions of West Bengal, Jharkhand,
Bihar, Odisha, Sikkim and Assam, the
organization is among the largest
finance providers in Eastern India.
With an ambition towards delivering
its services to more number of people,
Aris Capital plans to expand
aggressively towards north-eastern
Indian states in the near future.
We give our clients
complete and accurate
information and educate
them about the terms of
financial services offered
by us in a manner that is
understandable by them
June 2018 17
™

The Author is a Certified and authorized
Tax Return Preparer of Income Tax
Department of India; currently he is
Managing Director and Founder of ARS
Solutions.
ABOUT THE AUTHOR
All
b
o
u
t
TDSON
PROPERTY
PURCHASE
Tax @ 1% should be deducted by the buyer of the
property at the time of making payment of sale
consideration.
• Tax so deducted should be deposited to the Government
Account trough e-tax Payment option (Net banking) or
any of the authorized bank branches. Any sum so
deducted under section 194 IA shall be required to be
paid to the credit of the Central Government within a
period of seven days from the end of the month in
which the deduction is made.
• PAN of seller as well as buyer should be mandatorily
furnished in an online Form 26QB for furnishing
information regarding the property transaction.
• TDS certiﬁcate in Form 16B is required to be issued by
ALLABOUT TDS ON PROPERTY PURCHASE
(Understanding of Notice, Penalty, Late fees and
Interest on TDS for Purchase of Immovable Property)
- Abhishek Ranjan Singh
As per Finance Act of 2013, TDS is applicable on transfer
of Immovable property, wherein the consideration of the
property exceeds or is equal to ₹ 50 Lakhs. Sec 194 IA of
the Income Tax Act, 1961 read with Rule 30, 31 and 31A of
Income Tax Rules states that:
• For all such transactions with eﬀect from 1st June, 2013
Abhishek Ranjan Singh
MD & Founder
ARS Solutions
June 201818
™

the Buyer of property to the Seller, in respect of the taxes
deducted and deposited into the Government Account.
Major Points of Section 194 IA
• Person responsible for Tax Deduction: Any person
responsible for paying any sum to a resident transferor
by way of consideration for transfer of an immovable
property is liable to deduct tax at source.
• Threshold Limit: No tax is deductible where the
consideration paid or payable for the transfer of an
immovable property is less than 50 Lakhs. It is
deductible only wherein the consideration of the
property exceeds or is equal to 50 Lakhs.
• Time of deduction: Tax shall be deducted at the time of
credit of such sum to the account of the transferor or at
the time of payment of such sum in cash or by issue of a
cheque or draft or by any other mode, whichever is
earlier.
• Rate of TDS: TDS to be deducted @ 1% of the sum
paid. Condition of higher rate TDS if the deductee
(Seller) does not furnish PAN is not applicable because
PAN of buyer as well as seller is mandatorily furnished
in Form 26QB.
• On transfer of what type of property: Any immovable
property (other than agricultural land in rural area),
wherein the consideration of the property exceeds or is
equal to wherein the consideration of the property
exceeds or is equal to 50 Lakhs.
Agricultural Land Meaning Under Section 194IA
Ÿ Agricultural land means agricultural lands in India, It is
situated within jurisdiction of Municipality or
Cantonment Board which has a population of not less
than 10,000; or It is situated in any area within below
given distance measured aerially. A land shall not be
treated as Agriculture Land, if:
Other Important Points
• TDS on which amount: If the amount of property is 70
Lakhs, then buyer doesn’t have to pay tax only on 20
Lakhs but on the entire amount of sale consideration,
here it is on 70 Lakhs.
• TAN to pay the TDS: Buyer of the property is exempt to
procure Tax Deduction Account Number (TAN) for Tax
deduction and payment of TDS under this section.
• TDS on the entire amount or on the payment of each
installment: Tax needs to be deducted at the time of
payment either it is payment of entire amount or
installment. If the payments are being made in
installments then at the time every installment payment.
• If some amounts have paid before 1st June 2013: If
some amounts have paid to the seller before 1st June
2013 than TDS will be deducted on balance amount.
Either balance amount is less than ₹ 50 Lakhs or more
than ₹ 50 Lakhs this rule is applicable if the
consideration of the property (Total amount) exceeds or
is equal to ₹ 50 Lakhs. No TDS is required to be
deducted in respect of installments paid before 1st June,
2013. The provision will also apply in case where the
buyer has bought an under construction property prior
to this rule coming into effect but the part payment is
due after 1st June, 2013. TDS is required to be deducted
on all such installments Individually which fall due after
1st June, 2013 but only on principal portion and not on
the interest or penalty portion.
• If more than One Buyer or Seller: Challan and Form
26QB will be filled in by all the buyers for respective
sellers for their respective share. For example in case of
one buyer and two sellers, two challan and Form 26QB
have to be filled in and in case two buyers and two
sellers, four challan and Form 26QB have to be filled in
for the respective property shares. For application of
Section 194-IA total value of the property will consider,
not the respective share of buyer and seller. E.g
Property purchased by two buyer / seller and property
value is 80 Lakhs, So sale consideration respective
share of buyer / seller is 40 Lakhs each (below 50
Lakhs) but as per rule total value of the property will
consider, so Section 194-IA is applicable.
• Deposit of tax to the credit of the Central
Government: Any sum deducted under section 194-IA
shall be paid to the credit of the Central Government
within a period of seven days from the end of the month
in which the deduction is made and shall be
accompanied by a challan-cum-statement in Form No.
26QB. The sum so deducted shall be deposited to the
credit of the Central Government by remitting it
Population of the
Municipality
Distance from Municipal
limit or Cantonment
Board
More than 10,000 but does
not exceed 1,00,000
Within 2 kms.
More than 1,00,000 but
does not exceed 10,00,000
Within 6 kms
Exceeding 10,00,000 Within 8 kms
June 2018 19
™
Experts View

electronically to the Reserve Bank of India or the State
Bank of India or to any authorized bank.
• Certificate/statement for tax deducted at source:
Every person responsible for deduction of tax under
section 194-IA shall furnish the certificate of deduction
of tax at source in Form No. 16B to the payee within
fifteen days from the due date for furnishing the
Challan-cum-statement in Form No. 26QB under Rule
31A after generating and downloading the same from
the web portal specified by the Director General of
Income-tax (System) or the person authorized by him.
• Furnishing of statements by tax deductor to
department: Every person responsible for deduction of
tax under section 194-IA shall furnish to the Director
General of Income-tax (System) or the person
authorized by him a challan-cum-statement in Form No.
26QB electronically within seven days from the end of
the month in which the deduction is made.
Interest on default of TDS payment
If TDS is not paid on time to the credit of the Central
Government within a period of seven days from the end
of the month in which the deduction is made. Interest
under section 201 of Income Tax Act,1961 will be
payable. This Act expressly states that any person liable
to deduct TDS on the income distributed, makes default
in deduction and / or payment of TDS shall be treated
“assesse in default”. Such interest shall be paid before
furnishing the Form 26QB.
• If TDS has deducted but not paid: In this case one and
one-half percent (1.5%) for every month or part of a
month on the amount of such TDS from the date on
which such TDS was deducted to the date on which such
TDS is actually paid.
• If TDS is not deducted: In this case one percent (1%) for
every month or part of a month on the amount of such
tax from the date on which such TDS was deductible to
the date on which such TDS is deducted.
Late fee on default in furnishing statement of TDS
(26QB)
No filing or late filing of statement of TDS / TDS returns
(Form 26QB) shall invite late fees under section 234E. It
should be filed with challan within a period of seven days
from the end of the month in which the deduction is made.
Deductor will be liable to pay by way of fee of Rs 200 per
day till the failure to file TDS statement continues. The total
fee cannot exceed the amount of TDS deductible for which
statement was required to be filed. TDS return cannot be
filed without payment of late filing fees. In other words, the
late filing fees shall be deposited before filing the TDS
return (Form 26QB). It should be noted that Rs. 200 per day
is not penalty but it is a late filing fee.
Penalty on default in furnishing statement of TDS
(26QB)
No filing or late filing of statement of TDS / TDS returns
(Form 26QB) shall invite penalty under section 271H. It
should be filed with challan within a period of seven days
from the end of the month in which the deduction is made.
As section 271H which provides that a deductor shall pay
penalty of minimum Rs 10,000/- to Rs 1 lakh for not filing
the TDS statement within one year from the specified date
within which he was supposed to file the statement. Penalty
under section 271H will be in addition to late filing fees
prescribed under section 234E. Apart from delay in filing of
TDS/TCS return, section 271H also covers cases of filing
incorrect TDS/TCS return. Penalty under section 271H can
also be levied if the deductor/collector files an incorrect
TDS return. In other words, minimum penalty of Rs. 10,000
and maximum penalty of upto Rs. 1,00,000/- can be levied
if the deductor/collector files an incorrect TDS/TCS return.
TDS return will be filed without payment of Penalty under
section 271H. It may be levied on deductor by the assessing
officer.
Notice from TDS Reconciliation Analysis and
Correction Enabling System
TDS Reconciliation Analysis and Correction Enabling
System is sending two types of notice. One for demand of
interest payment if TDS is already paid but interest is
payable and second for demand of TDS and interest
payment if TDS is deducted or not deducted but not paid to
the credit of the Central Government and TDS return (Form
26QB) not filed.
June 201820
™

The REVIVAL of
NON-BANKINGFinancial Companies
ndia is a country where procuring a loan, is a process
Iwhich is not just confined to the boundaries of a bank.
Banks with all their corporate glamour and credit
rating criteria may intimidate a common citizen of our
country, which in most parts, still remains a ‘developing
country’. Indians are known worldwide for their creativity
when it comes to finding a ‘Jugaad’, a colloquial Hindi
term for finding a hack to a challenging situation. And find
a ‘Jugaad’ they did. Lending money for absurd interest
rates became a blossoming business opportunity. What
started off as a means for farmers without a piece of land to
set their business off soon became a common substitute for
banks among both the rural and urban population of our
country.
Through this crude concept of moneylending led to the rise
of small financial institutes which were mainly involved in
the business of lending loans and advances, something
which was already in practice in other parts of the world.
Over time such businesses grew, they were registered under
the companies’ act of 1956, India. They expanded the list of
services offered. From acquisitions of shares and stocks,
purchasing of bonds to the insurance business and the chit
fund business, they seemed to have everything covered. It
was almost as if they had become a bank without actually
becoming one. These businesses came to be known as Non-
Banking Financial Companies (NBFC’s).
What made them successful?
Banks tend to scrutinize an applicant thoroughly before
issuing a loan. NBFC’s on the other hand, were
comparatively easier to accrue a loan from. Such flexible
scenarios made such organizations seem lucrative to Indian
masses, so much so that it made the people overlook the
higher interest rates.
Their flexibility in functioning serves them the advantage of
being able to serve a broader range of clientele. For
instance multiple NBFC’s are setup with the motive of
funding only a particular kind of a business, currently there
are NBFC’s dedicated towards helping businesses
pertaining to power generation, transport and so many
more.
These institutions promote a selfless propaganda and a lot
of such organizations have gained tremendous goodwill in
market. They differentiate themselves from banks by
stressing on their customer oriented approach which again
can be attributed to their flexibility. They offer student loans
for unconventional courses, travel, businesses and such
matters for which banks may be hesitant.
One of life’s greatest ironies is when the very cause of your
success becomes the very cause for your setbacks as well.
The flexible and lax approach employed by such institutions
without any necessary research or background checks
turned out to be a double edged sword. While this strategy
was good for customer acquisition, the major drawback was
that there was no surety of the loan amounting to any kind
of fruition for whosoever may have taken it, leaving the
client with loans and no means of repaying it.
June 201822
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While NBFC’s were affected adversely by such incidents,
moneylenders and middlemen seemd to thrive on such
situations leading Prime Minister Modi to launch the
Pradhan Mantri Mudra Yojana (PMMY) scheme, aimed to
freeing young entrepreneurs from the malicious wrath of
the said middlemen. This scheme urged young
entrepreneurs to go to small financial institutions for
monetary aid rather than the illegal operators. This came as
a boost to NBFC’s and other micro financial institutions.
The PMMY scheme proved to be a masterstroke. With
planned loan facilities, easy paperwork and standardized
interest rates, the scheme has already seen more than 12
Crore entrepreneurs benefiting from it.
Are these businesses on the wane?
NBFC’s and MFI’s have an elevated sense of risk attached
to it when compared to conventional banking methods.
These institutions generally tend to demand a higher rate of
interest when compared to private sector banking facilities.
The lesser popular ones among such institutions are not
having a good business year as this year has seen multiple
organizations shut down. More than twenty NBFC’s have
shut operations just in the month of May alone. Worrying
numbers, one may say. The Indian banking scenario is
currently at a critical juncture with a surge in loan amounts
to corporate entities; it was improbable that the NBFC
business would go through unscathed and they certainly
have borne the brunt of it too.
While it cannot be said the business has entered a period of
stagnation with aggressive strategies like the PPMY already
in motion, the NBFC and MFI industry definitely has
leverage to claw its way back into business. While the
Indian banking industry has more deep rooted problems
than that of capital generation, the Non-Banking Finance
Companies only trim the hedge when it comes to the
problems the banking sector faces and hence could take
lesser time recuperating from the state of the market. With
the big names in the industry already going through pretty
much unscathed, NBFC’s are projected to remain a pivotal
part of the industry tending to matters regarding financial
aid. Especially with Indians and their beloved ‘Jugaad’, it’s
tough to see these institutions failing to serve a purpose.
June 2018 23
™
Editor’s view

he changing economical ways of financial
Testablishments are giving a new shape to India’s
financial situations. MFI plays a vital role in the
core development of infrastructure, transport, wealth
creation opportunities, employment generation, and
financial support for economically weaker sections; they
also create a mammoth of contribution to the state
exchequer. Moreover, with the banking system noticeably
constrained or escalating their lending activities, the NBFCs
plays an even more important role now, especially when the
government has a strong emphasis on promoting
entrepreneurship where India can transpire as a country of
job creators instead of being one with the job seekers.
In between these monetary fluctuations, Jagaran Microfin
Private Limited, a subsidiary of GTFS Multi Services
Limited was established with the distinct aim of providing
financial support, especially in the backward and rural
areas. The word “Jagaran” has been derived from Sanskrit
and it means “a state of wakefulness”. JMPL Started its
operation in the year 2010 (November) with 3 branches is
now operating across 5 states and 108 branch offices and
serving around 2 lacs women borrowers in the states of
West Bengal, Bihar, Jharkhand, Orissa and Assam.
The Pillars behind Jagaran
Jagaran is a subsidiary company of GTFS Multi Services
Limited., who are pioneer in the field of insurance and have
taken insurance to the door steps of the large number of
population. Jayanta Majumdar, Managing Director of
the company, is a Chartered Accountant with nearly 2
decades of experience in various fields of finance and
technology. Their Board members are eminent professionals
coming from all facets of the business. It is spearheaded by
the Executive Chairman Mr. Indrajit Gupta who is the
Ex- Dy Managing Director of State Bank of India and Ex-
CEO and Managing Director of SBI Capital Markets
Limited. They have Dr. Samir Barua, ex-director of the IIM
Ahmedabad and Dipankar Chatterjee a very renowned
Chartered Accountant and the past Chairman of EIRC as
independent director.
Along with them Dr. Somnath Ghosh (Director) who is a
Chartered Accountant with wide experience in taxation and
several other nominated directors like Dipak Rudra ,retired
JAGARAN MICROFIN
Delivering Best-in-class
Financial Services
Jayanta Majumdar
Managing Director
IAS Officer and the ex-Chairman of UCO Bank and P.K
Sarkar Ex-Dy Managing Director of SBI . They have 2
women representative in the Board, Dr. Kakoli Saha, who is
a professional member of ISABS, NTL (USA) and
International Coaching Federation, USA. She was formerly
a panel member of Institute of Banking and Personnel
Selection. And Miss Abira Majumdar who is the youngest
member of the Board with a sociological research and legal
background, she takes keen interest in various philanthropic
activities. She is actively involved at Indian Institute of
Cerebral Palsy.
A Dedicated Workforce Being the Backbone of Jagaran
Most of the employees of Jagaran are from the villages who
understand the needs of the rural areas. A continuous
training program makes them more knowledgeable about
the various compliance requirements and about dos and
don’ts of microfinance.
The values of Jagaran are reflected in the way of doing
business. ‘Respect to individuals’and ‘doing the right thing’
are the mantras. They believe in following the best
practices in every sphere of their business. The organization
has established a very solid corporate governance structure
June 201824
™

that has been well appreciated by the
rating agencies. The Board of Directors
comprises of the best people from the
banking and finance industry. The
members on board of Jagaran are
highly experienced professionals
having diverse knowledge in fields of
banking, finance, public
administration, accounts and audit.
The resilient structure of Jagaran and
the long term relationship it has with
the members have been acid tested
during the demonetization period and
could maintain a very healthy portfolio
after all these odds and maintaining a
repayment ration of 99.5% as on date.
Services offered by Jagaran
Jagaran’s products are designed in such
a way that apart from income
generation purposes it can also cater to
various needs and emergencies of the
economically poorest women. Their
ticket size varies from Rs.15000 to
Rs.40000 and the members can choose
any of the amounts based on their
requirements. Also, they have products
which are specifically designed for
various needs such as children’s
education or any kind of emergencies
etc.
Jagaran is now working on providing
loans which would absolutely be based
on the analysis of the current and
future needs. The loan amount shall be
pre-determined based on their future
cash requirement so that they don't
have to bear the interest unnecessarily
on the amount which they actually
don't need. This will be a game
changer in this industry where
microfinance customers would be able
to customise their products based on
their requirements and it would almost
be similar to Cash Credit facilities
designed according to their future
requirements. They have recently
introduced a program called ‘Bondhu’
where they provide financial support
amount to Rs.500, in case of death of
any member or co-borrowers, in order
to support them in their last rites.
The Clientele
Jagaran’s success stories lies in the
success of more than 2 Lacs. women
who are not simply getting a ‘micro’
loan as they call it, but being there at
the right time and providing them
necessary support in terms of
enhancing their skills, guiding them
through financial literacy programs
including helping them to open their
bank accounts making them a part of
Jagaran family.
Last few years, Jagaran have been
investing in technology immensely.
Today all the field staffs are being
provided with mobile phones which
are integrated and they can do all the
operational activities simply using their
phones. That reduced the loan
processing time considerably.
However, the company believes in
balancing the technology and human
relationship. That is why they meet
their members every week and interact
with them on various issues. Also,
Jagaran undertakes various CSR
initiatives like different skill
development programmes for women,
operating 15 primary schools in
villages and other health related
programmes through out the year.
Future Roadmap
In the year 2017-18, Jagaran achieved
a growth of 76% in terms of the loan
portfolio. They opened 20 new
branches last year and are planning to
open 40 new branches in the current
year and shall start their operation in
few new states. Last year their
customer base has increased
considerably and they will definitely
continue to add many new customers
in this year. Jagaran’s focus is not to
increase the ticket size but to increase
the customer base. This year, they are
envisaging more growth than last year.
Today, Jagaran is one of the major
players in Eastern India in
microfinance and they are sure that
they will be one of the major players
pan India within next 3 years’ time.
Our motto is to make an
analysis based
disbursements, by
designing products
according to needs
(Left to Right):The 100th branch opening of Jagaran at Sagar, West Bengal with Sri Bapin
Bose(ADGM-Operations),MD,Chairman, Dr.Somnath Ghosh(Director)
and Sri Debdulal Ghosal(Operations Head).
June 2018 25
™
The
10MostAdmired
NON BANKING
Rs
Rs
Rs

In the present economic system of India, Non-Banking Financial Companies have a significant role in providing
accessible and affordable financial services. Because of the consistent neglect by the banks of non-salaried Professionals,
individuals, traders, transporters and stockbrokers, and the ongoing stress in the public-sector banks due to mounting
debt, NBFCs have a lucrative opportunity to expand their presence in the Indian financial sector, more specifically the
underserved. The latent credit demand of an emerging India will allow NBFCs to fill the gap, especially where traditional
banks have been wary to serve.
With over 60000 satisfied customers across districts in Gujarat and Rajasthan, Light Microfinance aims to become the
leading Microfinance products and services provider in India. Light is managed by a passionate, high integrity dynamic team
of professionals with a keen focus on tech-enabled delivery of extremely relevant products in a cost-effective and risk-
managed manner.
An Ingenious Leader of Light Microfinance
With an unparalleled passion towards building strong dependable teams through right empowerment and enablement of
people, Rakesh Kumar, CEO is one of the founders of Light Microfinance. He brings with him invaluable field experience
of setting up microfinance operations from the ground up and scaling it to multiple states. He has extensive knowledge of
building, coordinating and leading teams, installing systems and setting complete work processes and procedures in large
successful organizations.
LIGHT
MICROFINANCE
Empowering Rural & Semi-Urban
Entrepreneurs Through
Innovative Financial Services
Rakesh Kumar
CEO
June 201826
™

Rakesh received his Master’s degree in
Rural Management from Institute of
Rural Management, Anand (IRMA).
Before joining Light Microfinance,
Rakesh worked with SKS
Microfinance (now known as BFIL).
He played a key part in its rapid
growth by launching and expanding
operations in seven states across North
India creating a customer base of over
150,000 and a robust portfolio of over
INR 100 crores ($25MM). Prior to
SKS, Rakesh was engaged in market
development for an educational
institute and publication house.
Distinctive Services for Nourishing
Financial Needs
Light Microfinance aims to become the
most valued financial service provider
to the rural and semi-urban population.
The company currently focuses on
broad-basing its micro-credit business
through Joint Liability Group (JLG)
model while developing capabilities to
bring more products and services to its
customers.
Light has started an operation with the
most basic microfinance product i.e.
microcredit. The company’s loans are
targeted towards income generation
activities and can range from Rs. 5,000
to Rs. 60,000 as per customer
requirement. The product can be one
year or two years long and is repaid in
equal monthly installments.
Light Microfinance believes in
building customer centric processes
and empower its women borrowers
through financial literacy inputs
delivered as part of the easy and
transparent loan application process.
With the aim of giving excellent
customer experience, the Company
continues to invest in technology for
further enabling its rigorously trained
manpower.
Rough Sea made a Skilled Sailor
Every organization goes through ups
and downs when it is trying to
establish itself. Light Microfinance was
born out of the conviction that
microfinance needs to change and as a
starting point, the credit transaction
must be reinvented to empower and
enable the customer. It is this passion
and commitment to innovate, driven by
fierce integrity and an aptitude to
persevere against the stiffest odds is
what has allowed Light Microfinance
to come out stronger from two industry
shaking macroeconomic crises.
In these times of crises, the leadership
team stood its ground and made the
intent clear to the team through
continuous communication and worked
hard with the team to chip away the
risks created in the ecosystem. Light
Microfinance was one of the first MFIs
to build an in-house GPS enabled end-
to-end mobile app in 2014. At the same
time, they maintain a keen focus on
innovations that are driven by effective
capital utilization.
Converting Challenges into
Opportunities
The Indian consumer is increasingly
adopting digital technology as a way of
daily life. To stay relevant in such
environment, NBFCs need to rethink
their strategy to enhance their product
portfolio. Additionally, they need to
leverage the vast digital customer data
for better customer services. With the
launch of the Digital India Programme,
NBFCs must find ways to serve the
millennial customers through digital
means.
With the launch of government-backed
schemes such as the Pradhan Mantri
Jan-Dhan Yojana, there has been a
substantial increase in the number of
bank accounts. The government and
regulatory bodies have taken decisive
steps to increase the number of a bank
account by granting in principal
licenses to many players to establish
banks over the coming time. The
introduction of specialized players and
systems will truly transform the
banking value chain in its entirety,
presenting a strategic opportunity for
NBFCs to ensure sustainable growth
over a long term. The reach of Light
Microfinance, along with their strong
understanding of the market can help
the company to position themselves as
a better alternative to the traditional
ways of banking.
Looking Into the Future
The underserved segment presents a
huge opportunity and good returns for
committed players who focused on
quality delivery backed by right
innovation. Light Microfinance wants
to become the most preferred financial
services provider to the underserved
segment and has always focused on
bringing more value to its customers.
The organization is already working
towards adding few such aspects to its
business model to further enhance the
household income and a standard of
living of its customers through new
credit options, healthcare, employment,
and skilling initiatives.
We develop products,
mobilize capital and
deploy technology
efficiently and
innovatively to deliver
extremely reliable high
touch customer service
June 2018 27
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The
10MostAdmired
NON BANKING
Rs
Rs
Rs

June 2018 31
™
The
10MostAdmired
NON BANKING
Rs
Rs
Rs

Financial Companies in the
Economic DevelopmentEconomic Development
In the present economic system, Non-Banking Financial Companies are playing a significant role in providing accessible
and affordable financial services. The NBFCs are becoming a vital player in financial inclusions indirectly boosting the
economy. These companies majorly focus on the business of loans, acquisition of shares, stocks, bonds, debentures and
securities allotted by the government, local authority or by other market securities. NBFCs are engaged in maturity
transformation and core banking functions. The operations carried out by the NBFCs merely aid threat to growing market
thereby leading to the economic development respectively.
Mobilization of Assets
NBFCs allow and provide with the mobilization of resources; funds and capitals. These companies
help the mobilization of assets by converting investment into most preferable sets. NBFCs
create a balance between intra-regional income and asset distribution. Turning the
savings into investment practices, these companies make a wide and strong
contribution to the economic development as compared to the traditional
bank practices. Such companies work without expecting to gain
the maximum profit which clears its idea of economic
development and, are also engaged in activities that
generate substantial or no revenue. Proper
organization of capital will surely help
in the development of the trade
and industry leading to the
economic expansion
and progress.
June 201832
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enhancing the motive to provide more
employment. The NBFCs lead to
increase in the capital stock which
results in employment growth.
Enhancing the Financial Market
The NBFCs cater the urban and rural
poor companies that have a
complementary role in the financial
inclusion. Microfinance plays an
important role to attain stable financial
inclusions. These companies bring the
much-needed diversity to the financial
market by diversifying the risks,
increasing liquidity in the markets
thereby promoting financial stability
and bringing efficiency to the financial
sector. The NBFCs have brought the
savings and investment operations
together leading to a progressive
change in the financial market. These
companies highlight the public issues
of corporations and provide the funds
needed by the start-up companies as
capital. The financial market is
dependent on the functions that are
taken into account by these lending
companies.
Nurturing the Standard of Living
The non-banking financial companies
are highly promoting the living
standards of the masses as they are
collaborating with the government as
well as private sector with their
operations. Upliftment in the standard
of living will surely make its path
towards the economic development.
These companies attract foreign
endowments majorly from different
Providing Long-Term Credits
NBFCs play a key role in providing the
corporations with funds through equity
participation. Unlike other traditional
banks, NBFCs offer long-term credit to
trade and commerce industry. These
companies help to fund large projects
and mega infrastructure projects which
boost economic development to a great
extent. The definition of long-term
credit loans is precisely transformed
with the emergence of NBFCs.
Long-term credit allows sustainable
growth and development of economic
sector with stable and softening
interest rates. NFBCs are also engaging
in funding small-scale industries and
MSMEs which will create a base for
the development and growth of the
economy.
Upliftment in the Employment
Sector
The operations and policies of NBFCs
are uplifting the job scenario. More job
opportunities are arising with the
influence of these companies in the
private as well as government sector.
NBFCs help in achieving full
employment in the economy by
working with the government and
investing in the private sectors. Also,
the business activities in the private
sector provide more employment
opportunities and occupation practices
due to such non-banking financial
companies. These companies go
hand-in-hand with the economy where
the need for personnel to handle
secured operations is high, thereby its
countries and agencies to merely
support and become a helping hand to
the economic growth and development.
The NBFCs vitally participate in
attracting funds from the public and
convert it into capital for industrial and
other sectors for smooth economic
growth. The progressive increase in
emerging businesses consequently
raising the demand for manpower and
creates employment leading to raise
the Purchasing Power Parity (PPP) of
people and upgrading their living
standards.
Future Renovations with NBFCs
The future will mark the financial
innovations driven by the NBFC sector
and will help it to grow in a prudential
manner. These companies will surely
be the game changer in the developing
economy by providing factoring and
bill payment service which are of
critical importance at the present
juncture. NBFCs will play a vital role
going forward, in closing the loop as
regards financial inclusion for
individuals and MSMEs which will
become the backbone of the economy.
Further, these companies are planning
to attain data and algorithm to fine-tune
the marketing campaigns and lower the
cost per acquisition resulting in higher
margins. NBFCs will surely help the
infrastructure companies grow
significantly with respect to its capital
and ethics. NBFCs will surely provide
real-time solutions to a company’s
stability and individual progress with
the growing economy.
June 201834
™

NBFCs over the years have played a vital role in the development of the economy, be it in financial intermediation in
rural and semi-urban areas or financing activities that are engines of growth, such as transport, infrastructure, farm
and MSMEs. NBFCs growth during the last two years has been quite impressive in spite of the challenging
environment and developments like demonetization. Moreover, this has been a healthy growth as reflected in the better asset
quality and that too complying with the regulatory framework, which have been harmonized with that for banks and other
financial institutions.
The trends emerging in India in terms of newer NBFCs entering various segments are highly encouraging. Sustainable Agro-
commercial Finance Ltd. (SAFL) is the first NBFC in India providing Agri- loans with a wide and diverse range of
financing options for almost every need of agricultural activity. The NBFC is commonly recognized by its acronym; SAFL
(pronounced SAFAL). It is a unique NBFC promoted by Jain Irrigation Systems Limited (JISL). SAFL is focusing its
activities on Farm and Farmer only and operates in the rural & semi urban geographies of India.
SAFL was incorporated in February 2011 and SAFL is headquartered in Mumbai with 72 offices across Maharashtra,
Karnataka and Madhya Pradesh. It plans to have a pan-India presence in next 5 years. The ethos is to make the individual
farmer’s life “SAFAL”. The organizations aim is directed at farmer empowerment, increased agricultural production and rural
prosperity. SAFL’s activities are focused on Farm and the Farmer. It has been setup with the objective of serving the small
SAFL:India’s First Dedicated
Agriculture Loan Company
Shri Arvind Sonmale
MD & CEO
June 201836
™

farmer and rural constituencies in India
in a comprehensive manner.
Artisan behind SAFL
Shri Arvind Sonmale, Managing
Director & CEO of SAFL is a career
Banker having been in the industry for
over 42 years. Born in Pune, India in
July 1950, Shri Arvind Sonmale
completed his Bachelor’s in Civil
Engineering in 1971. He started his
banking career as a Probationary
Officer in State Bank of India (SBI) in
July 1975. His 9 plus years with State
Bank of India (SBI) took him through
various areas of commercial banking
responsibilities including that of a
Branch Manager of a SBI’s office in
Panaji (Goa) and in SBI’s International
Division at its apex Central Office in
Mumbai.
Services Offered by SAFL
The main products financed by the
Company include Micro Irrigation
Systems (MIS) like drip irrigation and
sprinkler irrigation, Agri Projects,
Contract Farming, Lift irrigation
schemes, Small Business Loans, Solar
Pumps & Appliances, Third Party Tie-
ups etc. SAFL only finances products
which result in increased farm
productivity and improvement in the
economic betterment and lifestyle of
the farmers.
Strategies to Overcome Initial
Hiccups
The definition of sustainable
agriculture looks at a holistic approach
to farming. With sustainable
agriculture and water conservation as
its main focus, SAFL took up the pilot
project for financing agriculture and
allied activities in January 2013.
Selected farmers were introduced to
the drip irrigation facility at highly
competitive interest rates. SAFL also
worked with the Government
authorities to ensure a proper channel
of subsidies for the micro-irrigation
systems.
The efficiency of water usage under
conventional methods of irrigation,
which is predominantly practised in
Indian agriculture, is very low due to
substantial conveyance and distribution
losses. Recognizing the fast decline of
irrigation water potential and
increasing demand for water from
different sectors, a number of demand
management strategies and
programmes have been introduced to
save water and increase the existing
water use efficiency in Indian
agriculture.
One such method introduced in Indian
agriculture is micro-irrigation, which
includes both drip and sprinkler
method of irrigation. Micro-irrigation
is proved to be an efficient method in
saving water and increasing water use
efficiency as compared to the
conventional surface method of
irrigation, where water use efficiency is
only about 35-40 percent. Around 75%
of SAFL’s product portfolio comprises
financing of drip irrigation/micro-
irrigation. SAFL’s micro-irrigation
initiative has not only conserved water,
but also increased the crop yield
thereby having a direct impact on the
lives of the farmers. In its four and half
years of business operations, SAFL has
extended loans of over Rs. 545 crores
to more than 36000 farmers.
Awards, Achievements and
Recognitions
SAFL was honored with the “Best
NBFC of the Year” award at an
eventful function held at Taj Lands
End, Mumbai on Wednesday, February
14th 2018. This award was received at
the BFSI Event organized by World
HRD Congress, presented by ET Now
‘Rise with India’. Shri Arvind Sonmale
was honored with the ‘Leadership
Award’ at the recently held ‘2nd
NBFC100 Tech Summit’ at Bengaluru
on 07th December, 2017. The summit
was organized by Elets Technomedia
and powered by the Banking &
Finance Post Magazine, to cover the
factors affecting the rapid growth and
upcoming opportunities within the
NBFCs. He was also a part of the panel
discussion as a Key Speaker with other
CEOs, MDs and leaders from finance
and other sectors all of whom shared
their individual views over the growing
factors within the NBFC.
“Har Fasal SAFL, Har
Pal SAFL” is the hope
of every farmer who
will be assisted in
converting this hope
into a reality by SAFL
June 2018 37
™
The
10MostAdmired
NON BANKING
Rs
Rs
Rs

The Non-Banking Financial Companies (NBFC’s) and Microfinance Institutions (MFI) in India plays a pivotal role in
driving the inclusive growth of the country. Independent researchers suggest that with forty-seven million borrowers
and around fifteen billion USD as outstanding loans, India was the leader in 2016 in terms of microfinance. Acting as
a complementary to banks, NBFC-MFI’s have proved their viability as a business model in today’s diverse market.
One such influential company which also stands to be one of the largest NBFC of India is SV Creditline Limited (SVCL).
Founded in 2010, it has been the pioneer in assisting the economically backward entrepreneurs to align with the mainstream
economy. The company is registered as a Non-Banking Finance Company (NBFC-MFI) under Reserve Bank of India and is
promoted by Vans Pte. Ltd. and SV Corporation Pvt. Ltd. The corporate office is located at Gurugram, Haryana, along with a
major presence in the northern and central territories of the country. In the long term, it plans to have a PAN India presence to
cement themselves as a prominent player in the industry.
The customer-centric approach is amply reflected in their product offerings, followed by simplified processes, transparent
pricing structure & strong customer service orientation. The products offered by the entity include small credit for income
generating activities linked with credit life coverage. The robust management team has the expertise to manage complex
operations, identify new markets and formulate business strategies. SVCL Application suite is an innovative web-based
application which is designed to perform as lending platform along with analysis, monitoring, accounting, supervision and
works towards enabling a paperless environment.
SV CREDITLINE
Transforming the Face of Rural
India with Comprehensive
Services
Rakesh Dubey
CEO
June 201838
™

The Tenacious Leader
The guiding force who laid the
foundation of this eminent company is
Rakesh Dubey and is the CEO of SV
Creditline. In his professional career
spanning over twenty years, he is a
seasoned entrepreneur having a deep
background in the microfinance
domain along with setting up of MFI’s
in the domestic as well as in
international locations. Prior to
commencing his journey, he has also
been the founding team member of
CASHPOR and founder of SONATA
finance Pvt Ltd. He has completed his
master's in business administration and
has done a diploma in rural
development management. Rakesh is
deeply inspired by Prof. Yunus who is
a Nobel laureate and is considered as
the father of microfinance revolution in
Asia.
His business acumen has led him to be
a part of various institutions in key
roles in the microfinance industry.
Currently, he is the President of MFIN
and Board Member of ‘Sa-Dhan’
which is an MFI association
recognized as SROs formed by RBI in
2010. Additionally, he is also one of
the board members and treasurer of
Micro Finance Association of Uttar
Pradesh (UPMA).
Key Products – Setting New
Benchmarks
The entity has been set up with the
vision of building a professionally
managed and sustainable microfinance
institution. The motive is to assist the
under-served households by providing
an easy access to credit as well as other
financial services to make them
economically independent. The
business also aims to empower the
women to help their family by
providing opportunities to earn. Some
of the mentionable products are:
1) Business Loan
a) Group Loan
The company follows a social
collateral model wherein
microfinance group lending with
joint liability allows asset-poor
individuals to replace physical
collateral by social collateral. This
informal secured borrowing works
better in rural areas as compared
to urban areas as rural social
networks are typically denser,
which results in higher social
collateral. It also encourages rural
people to opt for income
generation loans so that they can
start their own business.
b) Short-Term Individual Loan
The organization has designed a
short-term loan for individuals
who are in urgent need of funds.
The loan tenure is about three
months and the fund is disbursed
at very low-interest rates taken
from the authorized and
unauthorized lenders in the
market. The process is kept simple
and is provided through an online
application with all the details
about the individual and the loan.
2) Green Loan
SV Creditline has introduced easy
finance for e-rickshaw buyers
within quick TAT and with easy
documentation. With growing
awareness about global warming,
e-rickshaw has come up as a
viable option in densely populated
areas. SVCL was swift enough to
gauge the issues of the prospective
buyers and they introduced the
easy finance model which
encouraged people to buy the eco-
friendly e-rickshaw to enhance
their business.
3) Shelter Loan
Although this constitutes a very
small portion, the organization has
introduced housing loan for
families who want to build their
homes or expand their house
pertaining to diverse needs.
Overcoming Challenges and
Achieving Success
The MFI sector has witnessed a
strong growth over the past few years
due to the evolving rural sector,
however, due to ‘demonetization’ the
company had to face a sluggish market
as the financial flow was very limited.
The market had dipped to approx.
twenty-five percent which was
flourishing at sixty-seventy percent in
the pre-demonetization era. This
restricted process made a deep impact
on the overall business; however, the
company has managed to overcome the
lean period and is on a steady
trajectory for the future.
Future Endeavors
The organization holds a very
optimistic view of the future. In order
to expand their reach to the rural
community living in remote areas, the
entity is working to roll out new
business strategies to increase the
borrowing power of the people,
empower women, and impart
knowledge among the weaker section
of the society.
SVCL is working towards
uplifting households out
of poverty by supporting
them in income
generation activities
through finance
intermediation
June 2018 39
™
The
10MostAdmired
NON BANKING
Rs
Rs
Rs

As per the survey reads India is the second largest
populated country in the world. The population
consists of rural and urban parts of the country.
According to the Census conducted in 2011, nearly 70% of
the country’s population lives in rural areas where,
unemployment is an issue. The growing population is very
crucial for the country’s economy. As the rural population is
so high it's a task to sustain the economy. But with changing
times, the rural India has fought back many odds and
emerged stronger. Many stories of young entrepreneurs
from the rural regions are appreciated and applauded. With
limited resources and knowledge, entrepreneurs started
running small businesses and are achieving new goals every
day. This was possible with the help of Non-Banking
Financial Companies (NBFCs).
Non-Banking Financial Companies has flourished in the
recent times. NBFCs are financial institutes not holding a
business license. The fact that it provides banking services
that is not abiding the legal definition of a bank is the
reason it catches attention of many. The impact and growth
set by NBFC have given rise to organizations ready to
invest in it. Establishment of such organizations has majorly
helped the economically weaker section of society. Due to
the various benefits provided by NBFC, it has become a
platform for women entrepreneurs to build up their
business.
NBFCs is registered under the Companies Act, 1956.It is
divided into two main categories which include NBFCs
accepting public deposit and NBFCs not accepting public
deposit .The services provided by NBFCs are unlimited.
NBFCs include Asset Finance, Investment, Loan,
Infrastructure Finance, Systemically Important Core
Investment, Infrastructure Debt Fund and Non-Banking
Financial Company-Micro Finance Institution.
Protocols to Run the System
NBFC must be registered with the Reserve Bank of India
(RBI) and have fixed legal authorization to accept deposits
from the public. It is obliged to exhibit the Certificate of
Registration or a certified copy at the registered office. The
registration of NBFC with the RBI solely authorizes it to
regulate the business of NBFC.RBI is not responsible for
the repayment of deposits approved by NBFCs. NBFCs is
strictly forbidden from using the name of RBI in any
manner while regulating their business. The Certificate of
Registration is an application which is requested by
NBFCs. If the Certificate of Registration gets rejected or
cancelled by the RBI then it does not authorize to accept
The Stature of
Financial
Companies
June 201842
™

new deposits or renew existing deposits.
Contributing to Sustain Economy
The role of NBFCs is extremely significant to an economy,
where a large part of the population still lives in rural areas
with little access to financial services and benefits. The role
of NBFCs as productive intermediaries has been well
recognized and acknowledged. The core strengths of
NBFCs lie in powerful customer relationships, sharp grip
on regional dynamics and customized services. Lending
money against securities and microfinance and have been
extending credit to retail customers in under-served areas
and to unbanked customers.
NBFCs have benefited many young entrepreneurs to
perform without constant pressure in order to make their
dreams come true. NBFCs are not just serving young lads
but also to women entrepreneurs. Women in rural India are
no longer dependable. They have shattered all the barriers
of social norms and emerged with flying colors. Be it small
businesses like vegetable or fruit vending or setting
up a ready-made garment shop. Women are
gradually becoming great personalities and
inspiring everyone around them. With their
successful business, women are supporting
their families and contributing towards
social welfare.
Escalating with Time
NBFCs have emerged in various
sectors and are playing important roles
in the Indian economy. The specific roles of NBFC are
developing sectors like transport and infrastructure, help to
increase wealth and providing finance to economically
weaker section. NBFCs have expanded in every possible
ways across the country and have 13,000 members
registered with them. Nearly 600 NBFCs receive public
deposits and the finances assets worth 15000 crores
annually. With these stats NBFCs are providing good
quality finance to various sectors.
NBFCs are already known as the game changers, as it has
set an impact for financial incorporation, micro finance,
reasonable housing, vehicle finance, gold lons and
infrastructure finance. NBFCs can play a key role by going
forward, in closing the loop as regards financial
incorporation for individuals and Micro, Small and Medium
Enterprise (MSMEs). NBFCs have reached to various
financial products offered by the security industry which are
shares, mutual funds and depository services etc.
As NBFCs have specialized performers, in the
future the companies are capable
of solely changing the
banking value chain
to enhance the
sustainable
growth of the
economy in
rural areas for
the long run.
June 2018 43™
The Economic Stature

S
hikhar came into being with a vision to build an
organization to cater to the people who, due to their
social location, did not have access to resources and
institutions to fulfill their needs and aspirations. Shikhar
wanted to bring to these people, an alternate source of
borrowing, to help them develop a sense of
entrepreneurship which would free them from the clutches
of the loan sharks and local money lenders. The envisioned
end result of this was to instill in them a sense of self-
reliance, self-confidence, resilience and facilitate these
institutionswhich meant to serve them.
At the time of inception, Shikhar actively probed into areas
that were “financial blackholes”,Obviously, those living in
these areas were mentally and physically scarred and their
lives spoke of their traumas. No financial institutions made
investments in these black listed areas. However, Mr.
Chakrapani knew that his vision for Shikhar had to take
shape from these neglected spaces and thus, Shikhar
Microfinance began its journey. Shikhar has managed to lay
the foundation of urban microfinance in a country where
there exist vast disparities in economic levels.
A Leader Benevolent
Since his childhood, Mr. Chakrapani was exposed to the
grassroots, owing to his father who established numerous
schools to ensure all the children received primary and
secondary education. It was in these schools that Mr.
Chakrapani and his three siblings completed their
schooling. Mr. Chakrapani says that he owes his humility to
his early school days and he is still connected with his
school mates and those with whom he herded animals. It is
in the company of these people that he can imagine the
impact of microfinance.
Shikhar Microfinance
A Microfinance with a difference
Satyavir Chakrapani
Managing Director Chief Executive Officer
He did his masters in History, then finished his degree in
law after which he got his Licentiate in Teaching. While
working as a consultant, he got introduced to the concept of
micro credit and in the following year, the seed of
microfinance began to germinate in his mind. Backed up by
his strong Gandhian ideals, he enrolled into the
Entrepreneurship Development Institute in Gujrat, India, to
study Social Entrepreneurship, against the Institution for
Development Studies in Colorado. With this experience, he
began federating SHGs and helped in designing self-
financing health schemes and self reliant cooperatives in
various states.
Apart from leading Shikhar Microfinance, Mr. Chakrapani
also takes care of his second brain child, ‘Sewa Ashram’,
which aims to rehabilitate the poor and destitute in the
NCR. It focusses on enabling the destitute to live and die
with dignity. It also runs learning centres in various other
slums for under privileged children, enabling them to attend
formal schooling.
Over the decade, Shikhar has aided thousands of families to
grapple with poverty. It is amazing to see an ordinary man
June 201844
™

like him and his colleagues use
ordinary methods, to create extra-
ordinary impact on the lives of the
marginalized simultaneously creating
opportunities for the investors to gain
good returns on their investments.
Distinctive and unique serving style
Shikhar has been trying to bridge gaps
by making bold moves which can be
seen as ‘firsts’ in the Indian
microfinance space. Few of these
include, introduction of monthly
repayment of loans instead of the
classical microfinance trend of weekly
repayments. Shikhar’s first product,
“Redemption Loan”, aimed to liberate
people from local moneylenders. Post
this, in 2015, while people were
struggling to create Jan Dhan accounts,
members from Shikhar, went out of
their way to physically assist the
clients to setup up savings accounts
which ensured 100% cashless loan
disbursement, amother first! This
initiative enabled Shikhar to sail
through the demonetization period.
Shikhar has always focused on active
“client engagement” wherein clients
are facilitated with and assisted on
issues related not only to
entrepreneurship but also their
livelihoods. Seeing that rampant power
cuts detered studying and halted
household functioning, Shikhar started
providing solar products to its clients.
Shikhar also partners with Unilever to
directly supply PureIt water filters to
its clients as water borne diseases are
on a continuous rise.
Shikhar recognizes that a healthy and
disease free life saves the client from
medical expenses and losing work days
which leads to losing wages. Shikhar’s
holistic approach to the clients’ needs
and aspirations ensures that the client’s
household cash flow remains intact in
dire situations and they don’t fall into a
trap of debt. In line with this, a pilot
project was conducted recently, in
collaboration with Grameen
Foundation, on educating the client on
usage of bank accounts and inculcating
the habit of saving through various
bank channels. The project was well
accepted by the clients and the
outcome of the same would serve as a
purpose for enhancing and further
strengthening of our financial
education model.
Holding true to its values
Shikhar serves people who have been
denied fundamental opportunities.
There exists a glass ceiling between
them and their aspirations which
comes in the form of social exclusion
in various spheres of life. This is the
ceiling that Shikhar aims to shatter.
One value that Shikhar continues to
uphold is to see that every human
being is made in the same likeness thus
making everyone equal and equally
able. Keeping this in mind, there exists
a relationship of trust and belief
between Shikhar, as an organization,
and its clients. Shikhar has used this
relationship to bridge gaps among
communities based on caste, creed and
culture, thus a counter culture being
created. It also aims to ensure women's
economic freedomin the communities
that it works with. After ten years of
strenuous and devoted efforts,through
measured, practical steps, Shikhar is
seeing its dreams in action.
Road Ahead
The road ahead is paved with
challenges for micro finance
institutions (MFIs) yet they continue to
grow because of a circle of trust among
the institution, investors and client
households. In this arena, Shikhar has
the aim to reach out to 200 thousand
household by the year 2022. To fulfil
this goal, Shikhar is in conversation
with few strategic investors. These
partnerships will ensure that Shikhar
achieves its goal to serve underserved
geographies and households thus
ensuring thatall stakeholders maximise
their value too.
The future for MFIs in general seems
to be moving forward exponentially,
because of the very model of business
that MFIs follow. There exists a
flexibility and agility when it comes to
providing services to the
underpriviledged demographics. The
challenge in dealing with this
demographic also ensures that the
business model doesn’t remain
stagnant, instead has a dynamic
growth. A good example of this is how
the local cash based economy has
recovered after demonetisation. In fact,
in the last financial year, there was a
40% growth in investor equity. There is
a viable expectation from MFIs and
Shikhar is excited to see what is in
store for them in the future.
We are a value-based
organization—our core
values guide and direct
all of our actions
June 2018 45
™
The
10MostAdmired
NON BANKING
Rs
Rs
Rs

ARISING WITH THE FINANCIAL
TECHNOLOGY ECOSYSTEM
ARISING WITH THE FINANCIAL
TECHNOLOGY ECOSYSTEM
O
ver the last year and a half,
the financial technology
ecosystem has emerged as
one of the hottest sectors in India’s
internet play. With funding pouring in,
even global players like Google and
Whatsapp are looking to get a piece of
this pie. According to NASSCOM, the
Indian fintech market is expected to
grow at a CAGR of 22 percent for the
next five years. Another KPMG report
states that the transaction value for the
Indian fintech sector was estimated to
be approximately $33 billion in 2016
and is expected to reach $73 billion by
2020. My key observations are as
below
• Fintech in India is still young
Data shows that almost 64 percent of
fintech organizations in India have
been in business for close to three
years now, with median employee
strength of 14 people. Furthermore, 61
percent of the founders are under the
age of 40 (25 percent less than 30 years
of age, and 35 percent between the age
of 31-40). Being at a nascent stage,
only 7 percent of respondents have
seen their companies turn profitable.
• India has the second highest global
fintech adoption rate with
collaboration
As per a report in EY, the fintech
adoption index in India is the second
highest and 59 percent higher than the
global average. It shows that
incumbents and fintechs have moved
from competition to co-opetition and
collaboration. Seventy-nine percent of
respondents view incumbents as
partners while 13 percent are
indifferent and only 8 percent of them
view them as competitors
• Lending is a massive opportunity
There’s report which states that Rs
26.5 trillion of the SME debt demand
unmet by formal channels presents a
huge opportunity for fintech firms.
Further, it highlights that MSMEs
often do not have access to formal
lending channels, and rely on the
informal sector, at interest rates as high
as 30 percent. Moreover, smaller
businesses also have limited financial
history and might not have detailed
documentation available at hand,
which becomes a major hurdle in the
loan disbursement process.
· The talent pool is not ready for the
future
As many as 87 percent founders
identified that employees focused on
technology development or coding are
the core of their workforce. On
average, 33 percent of total employee
strength (in Indian fintech) comprises
of coders; this number is as high as 67
percent for idea and pre-revenue stage
startups. However, the current talent
pool for Indian fintech is low on future
tech skills or knowledge. About 71
percent of respondents state lack of
deep tech expertise as a key
impediment to their growth. All
fintechs using Block chain technology
highlighted that the availability of
coders in the technology is especially
low, with many respondents hiring
their coders from Russia, Poland, or
Silicon Valley.
• Proof of concept and early stage
funding is still limited
Fintech funding in India rose from
$300 million in 2016 to $2.7 billion in
2017. This shows that fintechs have
shown a 34 percent year-on-year jump.
However, Proof of Concept (PoC) and
early-stage funds are limited. As many
as 71 percent of pre-revenue and 81
percent at idea stage fintechs noted
“severe difficulty” in raising funds.
• Managing burn rate is emerging as
a key issue for Indian fintech
According to a data 74 percent of the
startups have a burn rate between
$10,000 and $50,000 per annum, with
only 7 percent of them being
profitable.
• Accelerators and incubators might
actually be supporting in
commercialization
Fintech hubs, accelerators, and
incubators might be playing an
important role due to their ability to
provide mentorship and access to
investors, corporates, and funding.
June 201846
™

Rajesh Nair
Founder
A career banker with 12
years of experience in
Financial Planning. Founder
of EarnWealth Solutions Pvt
Ltd, a wealth management
company in mid 2014.
Successfully set up the
Treasures Priority Banking
Wealth Management
franchise for DBS Bank
Pune. Joined the private life
insurance space in 2001 on
opening of the sector as an
agent with Bajaj Allianz Life
Insurance. Joined ICICI
Prudential Life Insurance in
June 2006 as Sales Manager
established Beed branch.
Moved to Aurangabad and
took over a struggling
branch and created many
records. Joined Tata AIG Life
as a branch head in May
2009. Successfully
established PCMC branch
built one of the most
admired sales teams in
TALIC. Got promoted as an
Area Manager in June 2010.
ABOUT THE AUTHOR
June 2018 47
™
FINANCIAL TALK

The 10 most admired non banking financial companies in 2018

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