Long haul for NBFCs as funding environment to remain volatile in FY21

Thus, NBFCs have increased their focus on collections and have tightened underwriting standards

The funding environment for non-banking financial companies (NBFCs) has improved from what it was in April and May 2020.

However, mutual funds are still exercising caution in funding them. State-run banks have lent money to NBFCs under the Targeted Long-Term Repo Operations and Partial Credit Guarantee schemes (18-month money). India Ratings (Ind-Ra) said that the funding environment would remain volatile during FY21, and further disruption in the operating environment could make access to funds challenging for low-rated NBFCs.

 

It added that it would be a long time before NBFC operations returned