IL&FS crisis: For NBFCs, India's 'Lehman moment' has meant reset of future

India's 'Lehman moment' has meant that the high-teen growth phase for non-banker financers is over

Two and a half years after the infrastructure behemoth Infra­st­ructure Leasing & Financial Services (IL&FS) plunged into crisis, the collateral damage was widespread across the financial sector. On the whole, the system appears to be far less impacted than anticipated. If non-banking finance companies (NBFCs) are separately analysed, however, the inference could be very different.

For non-banks, the IL&FS crisis was nothing short of India’s Lehman moment, which has for a foreseeable future reset the sector on multiple grounds.

Securitisation, or monetising loans by selling them to banks and other financial institutions, hit an all-time high within months of the