Page 34 - Nbfcs

NBFCs need to diversify funding sources, reduce reliance on banks: RBI

NBFCs' reliance on banks increased, particularly for NBFCs in the upper layer (NBFCs-UL), whose direct bank borrowings have grown steadily

A new dawn for microfinance

There are many contributing factors to the growth and new-found enthusiasm for microfinance

Mutual funds debt exposure to finance companies rose 60.1% in July

The exposure through investment in commercial paper of NBFCs crossed the Rs one trillion mark, last seen in August 2019, it said

RBI releases list of 15 NBFCs in upper layer under scale based regulations

All deposit-taking NBFCs and non-deposit-taking NBFCs with an asset size over Rs 1,000 crore are in the middle layer

RBI says 15 large NBFCs to comply with enhanced regulatory requirements

Reserve Bank of India on Thursday said 15 large NBFCs, including LIC Housing Finance, Bajaj Finance, Shriram Finance and Tata Sons, will be subject to enhanced regulatory requirements. The central bank has categorised NBFCs into Base Layer (NBFC-BL), Middle Layer (NBFC-ML), Upper Layer (NBFC-UL) and Top Layer (NBFC-TL). A list of 15 large Non Banking Finance Companies (NBFCs) falling in the Upper Layer category has been released. Besides LIC Housing Finance, Bajaj Finance, Shriram Finance and Tata Sons, others in the list include L&T Finance, Piramal Capital & Housing Finance, Cholamandalam Investment and Finance Company. Indiabulls Housing Finance, Mahindra & Mahindra Financial Services, Tata Capital Financial Services, PNB Housing Finance, HDB Financial Services, Aditya Birla Finance, Muthoot Finance and Bajaj Housing Finance are also part of the list. According to RBI, despite qualifying for identification as NBFC-UL as per scoring methodology, TMF Business Services Ltd

RBI releases list of NBFCs in upper layer under scale-based regulations

In terms of the framework, once an NBFC is classified as NBFC-UL, it shall be subject to enhanced regulatory requirement, at least for a period of five years

India Inc faces costlier borrowing as corporate-govt yield gap widens

The yield spread between the AAA-rated 5-year corporate bond and the 5-year government bond narrowed by 7 basis points in August

State-owned non-bank lender IREDA files for IPO with market regulator

State-owned non-banking financial company, Indian Renewable Energy Development Agency (IREDA), has filed for an initial public offering (IPO) with the country's markets regulator, as per draft papers

Developing best practices

SRO for fintechs will be a first step

Fintechs can act both as competitors and collaborators: T Rabi Sankar

He said regulators also draw comfort in these arrangements as traditional financial entities- banks, NBFCs which are well regulated will continue to discharge the basic responsibility

Chief executives of shadow banks urge RBI to allow public deposits

Number deposit taking NBFCs fell sharply in last 8 years

Loan sanctions through NBFCs slip sharply to 5.7% in June quarter

Sequentially, the sanctioned shrunk by 20.3 per cent over the quarter ended March 2023 (Q4FY23), data from Finance Industry Development Council (FIDC)-CRIF showed

GeM's provision of penal interest on delayed payments to start from Sept

A provision to enable public procurement portal GeM to impose penal interest for making delayed payments to vendors by government ministries and departments will be fully operational from end of this month, a senior official said on Tuesday. In 2020, the government decided to levy a 1 per cent penalty on government departments and agencies for delayed payments to vendors selling goods on the GeM platform. "The functionalities have been developed... In about three weeks time, it will be fully functional," Government e-marketplace (GeM) CEO P K Singh told reporters here. He said that for non-Public Financial Management System (PFMS) payments, the portal is calculating the interest but for PFMS things, work is in the final stages. The PFMS, administered by the Department of Expenditure, is an end-to-end solution for processing payments, tracking, monitoring, accounting, reconciliation and reporting. "wherever there will be a clear violation, penal interest will be collected...but we

RBI must seriously consider deposit licences for NBFCs: Ajay Piramal

"By the end of September, we will have approximately Rs 6000 crore of cash in the balancesheet, which is much more than the LCR requirements"

Shriram Finance's Umesh Revankar takes charge as chairman of FIDC

Revankar, the newly elected chairman of FIDC, expressed his gratitude and enthusiasm for the opportunity

RBI guv Shaktikanta Das asks NBFCs to reduce reliance on bank borrowing

Cautions on risk with unsecured lending; Remain alert against complacency

Infra debt fund NBFCs must have net owned fund of at least Rs 300 cr: RBI

Infrastructure Debt Fund-NBFCs (IDF-NBFCs) will now be required to have a net owned fund (NOF) of at least Rs 300 crore, said the Reserve Bank's revised norms for such entities issued on Friday. Besides, they should have a capital-to-risk weighted assets ratio (CRAR) of minimum 15 per cent (with minimum Tier 1 capital of 10 per cent). RBI said a review of the guidelines applicable to IDF-NBFCs has been undertaken in order to enable them play a greater role in financing of the infrastructure sector and to harmonise the regulations governing financing of infrastructure sector by NBFCs. The review has been undertaken in consultation with Government of India. An IDF-NBFC is a company registered as NBFC to facilitate the flow of long- term debt into infrastructure projects. It raises resources through issue of rupee or dollar-denominated bonds of minimum 5-year maturity. Only Infrastructure Finance Companies (IFC) can sponsor IDF-NBFCs. "IDF-NBFC shall raise funds through issue of eith

Banks' lending to NBFCs soars 35% to Rs 14.2 trn in June: Care ratings

Banks' lending to non-banking finance companies (NBFCs) rose by 35.1 per cent to Rs 14.2 lakh crore in June, a report said. Credit exposure of banks to NBFCs rose by a robust 35.1 per cent on-year to Rs 14.2 lakh crore in June, indicating non-banking finance firms' decreased reliance on international borrowings. This also pushed up NBFCs' share in overall credit from 8.5 per cent in June 2022 to 9.9 per cent in the reporting month, according to Sanjay Agarwal, a senior director with Care Ratings. However, the report noted that the merger of HDFC with HDFC Bank, effective July 1, will lead to a reduction in the share and also the exposure of banks to NBFCs, as HDFC's bank borrowings will undergo a temporary reclassification, resulting in a shift of exposure to HDFC Bank. Meanwhile, mutual funds' debt exposure to NBFCs, including through commercial papers (CPs) and corporate debt, also increased 14.5 per cent to Rs 1.62 lakh crore in June, it said. According to the report, MF exposur

The death of a defaulter

There are a few lessons to be learnt from art director Nitin Desai's suicide

Manappuram Finance Q1 results: Profit rises 76% on gold loan demand

Shares of the company closed 2.84% up after the results