Non-banking financial companies (NBFCs) provide financial services like banks but are not subject to the Banking Regulation Act of 1949. NBFCs engage in activities like equipment leasing, hire purchase, housing finance, and investment/loans but have some limitations compared to banks. The document discusses the roles and various classifications of NBFCs such as leasing companies, housing finance companies, investment companies, loan companies, mutual benefit companies, chit fund companies, and residuary non-banking companies. NBFCs generally charge higher interest rates than banks and have regulatory oversight from bodies like SEBI and RBI rather than just the Banking Regulation Act.

1. Introduction to Non-Banking Financial Companies(NBFCs)
Role and Classification
Group No: 6

2. Introduction to (NBFCs)
What are NBFCs?
Services
Their main competitors
Net owned funds of NBFCs

3. Introduction to (NBFCs)
How do we differentiate between a bank
and a non-bank finance company ?

4. Introduction to (NBFCs)
Bank NBFCs
An institute which
is governed by the
BRA, 1949

An institute which
is not governed by
the BRA, 1949


5. Classification to (NBFCs)
Equipment Leasing Company?
Lessor and Lessee?
2 types of leasing arrangements
are:
i. Operating leasing
ii. Finance leasing

6. Classification to (NBFCs)
Payment is easier
No Risk
Tax concessions

7. Classification to (NBFCs)
Hire-purchase Finance Company ?
Main Features

8. Classification to (NBFCs)
 Housing Finance Company?

9. Classification to (NBFCs)
 Investment Company means?
 2 Types
i. Holding Companies
ii. Other Investment Companies

10. Classification to (NBFCs)
Loan Company?
Little Capital
Imp. Suggestions by
Banking Commission
i. License
ii. Liquidity ratio
iii. Limit on the interest rates

11. Classification to (NBFCs)
 Mutual Benefit Financial Company?
 Registration process
 Provide Loans &
Saving Schemes
1
Rupee

12. Classification to (NBFCs)
 Chit-Fund Company?
 For Whom

13. Classification to (NBFCs)
 Residuary Non-banking Company?
 Collection at the doorsteps
 Adverse features
i. Negative net-worth
ii. Some do not submit periodic returns

14. Role of (NBFCs)

15. Functions to (NBFCs)

16. Commercial bank Vs. NBFCs
 Cheque can be
issued
 Less rate of interest
 Regulated by BRA
and RBI
 Hold a variety of
assets
 Cheque cannot be
issued
 High rate of
interest
 Regulated by
SEBI, Companies
Act, RBI etc.
 Hold one type of
asset