Not Competitors

To make economic liberalisation more meaningful, these rules should be amended to make NBFC's at par with banks.

NBFC funds for lending purposes can be done by FIs, so that they need not depend on banks. According to recent estimates there are around 10,000 registered NBFC's. With an average of two branches each, there would be 20,000 branches all over the country, these can supplement the banks in lending activity.

Banks even with there tight controls and rules incur huge losses, where as the NBFC's in spite of lesser availability of funds have shown excellent growth.

As Mr Atul Nishar points out, NBFC's are supplementary to the banking system and not competitors.