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Nbfc

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Nbfc

  1. 1. Definition of Non-Banking Financial Company- NBFC‘“Non-banking financial companies, or NBFCs,are financial institutions that provide bankingservices, but do not hold a banking license. Theseinstitutions are not allowed to take deposits fromthe public. Nonetheless, all operations of theseinstitutions are still covered under bankingregulations.’’
  2. 2. Types of NBFC1: Asset finance Companies (AFC) AFC are financial institutions whose principal business is of financingphysical assets such as automobiles, tractors, construction equipments materialhandling equipments and other machines. ex: Bajaj Auto Finance corp. , Fullerton India etc2: Investment Companies (IC) ICs generally are involved in the business ofshares, stocks, bonds, debentures issued by government or local authority thatare marketable in nature ex: Stock Broking Companies, Gilt firms3: Loan Companies (LC) LCs are loan giving companies which operate in the business of providingloans. These can be housing loans, gold loans etc ex: Mannapuram Gold Finance, HDFC
  3. 3. Difference between NBFC’s and Bank’s(i) a NBFC cannot accept demand deposits (demand deposits are funds deposited at a depository institution that are payable on demand -- immediately or within a very short period -- like your current or savings accounts.)(ii) it is not a part of the payment and settlement system and as such cannot issue cheque to its customers drawn to itself; and(iii) deposit insurance facility of DICGC (Deposit Insurance and Credit Guarantee Corporation ) is not available for NBFC depositors unlike in case of banks.
  4. 4. Role of NBFCsAs recognized by RBI and expert committees Development of sectors like Transport & Infrastructure Substantial employment generation Help & increase wealth creation Broad base economic development Irreplaceable supplement to bank credit in rural segments major thrust on semi-urban, rural areas & first time buyers / users To finance economically weaker sections Huge contribution to the State exchequer
  5. 5. Top five NBFCs in India:• Housing Development Finance CorporationLimited• Power Finance Corporation Limited• Rural Electrification Corporation Limited• National Bank of Agricultural and RuralDevelopment• Infrastructure Development Finance CompanyLimited
  6. 6. Top NBFCs in KeralaMuthoot FinanceManappuramMuthoot FincorpPopular FinanceChemmannorr Gold LoanPNY SabhaPoonkavanam FinanceMini Muthoot Gold Loan
  7. 7. Mathews……….

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