Question

what are the source of finance of nbfc

Answer 1

Non-banking finance companies have, of late, become the go-to place for micro, small and medium enterprises in need of funds. Lending to MSMEs had earlier been the forte of banks and NBFCs had a limited role in this segment.

But now, this is changing. Enquiries with many small businesses showed one common and recurring theme — the absence of sufficient and timely funds from the banking sector for their working capital or investment needs.

There are over 51 million such enterprises in the country contributing to about a third of GDP — so the dimensions of the problem are widespread.

One facet of the problem has simply been the cornering of bank credit by large corporates. Of the ₹26 lakh crore lent by Indian banks to industry, large firms have taken away ₹21.5 lakh crore or about 83 per cent of those loans.

Answer 2

insurers offer finance 
debentures and bonds