NBFCs have enough liquidity, buffers to tackle headwinds in H2 FY22: Ind-Ra

In FY22, Ind-Ra expects growth for NBFCs to be maintained in the range of 9%-10%

India Ratings (Ind-Ra) has upgraded the outlook for retail non-banking finance companies (NBFCs) and housing finance companies (HFCs) from “stable” to “improving” for the second half of current financial year (H2 FY22).

These financial sector firms have adequate system liquidity (because of regulatory measures), along with sufficient capital buffers, stable margins due to low funding cost and on-balance sheet provisioning buffers. This provides enough cushion to navigate the challenges that may emanate from a subdued operating environment.

Such challenges could lead to an increase in asset quality challenges due to the second Coronavirus (Covid-19) wave impacting disbursements and collections for