NBFCs looking at offshore funds to diversify borrowing sources

The relaxation in the ECBs and masala bonds norms has made it attractive for the NBFCs and HFCs to tap into the offshore credit market for funds

To diversify borrowing sources and reduce dependence on traditional funding avenues like banks, mutual funds and insurance companies, non-banking financial companies (NBFCs) and housing finance companies (HFCs) are now looking to tap into the offshore credit market via masala bonds, external commercial borrowings (ECBs) and foreign currency bonds.

“So far, NBFCs had no appetite. But since the appetite is coming back, all the HFCs and NBFCs are looking at various avenues of funding like retail bond issue, foreign institutional investor’s (FIIs') money and offshore issuances,” said Ajay Manglunia of Edelweiss Securities.

After sudden defaults by Infrastructure Leasing & Financial Services