Non-Banking Financial Companies (NBFCs) have become important players in India's financial world. They offer a wide range of services that complement what traditional banks provide. Unlike banks, NBFCs don’t take demand deposits; instead, they focus on lending and investments. Over time, NBFCs have grown significantly and now play a major role in the financial sector.
The NBFC sector in India is booming, with a projected growth rate of 18.5% annually from 2021 to 2026. This growth is reflected in their increasing annual revenue, driven by areas like housing finance, microfinance, and consumer finance.
With this rapid development, there's a lot of anticipation for the upcoming Union Budget to support the needs of NBFCs. Pavitra Pradip Walvekar believes the budget should tackle key challenges for the NBFC industry, such as issues with liquidity and the need for regulatory changes.