Banks prefer direct assignment with NBFCs despite colending relaxations

Despite the recent relaxation in colending norms, banks are likely to maintain their preference for direct assignment with non-banking financial companies (NBFCs) rather than colending arrangements.

 

Industry experts suggest that while colending volumes among NBFCs are expected to grow, driven by operational synergies and flexible structures, banks will continue to favour direct assignment, said industry experts.

 

“I think we will see a lot more business move to direct assignment rather than colending in the current environment,” said Jairam Sridharan, managing director and chief executive officer (CEO), Piramal Enterprises, in the post-earnings call.

 

“But one area in which you will see