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Know the Different Types of NBFC Companies in India

 

A NBFC or a non banking financial company is a company registered under the Companies Act, 1956 of India. Such companies are engaged in business activities of providing loans and advances, acquisition of shares, stock, bonds hire-purchase insurance business or chit business.

The operations of NBFCs are regulated by the RBI within the framework of the [Reserve Bank of India Act, 1934] and the directions issued by it. As per the new norms issued in 2017, NBFCs cannot outsource core management functions like internal audit, management of investment portfolio, strategic and compliance functions for knowing your customer (KYC) norms and sanction of loans.

Different types of NBFCs:

There are many Nbfc Companies in Bangalore for instance that provide loans for different purposes.These companies provide loans for many purposes which the bank does not provide loans for. For this reason, NBFCs are now being preferred by many loan seekers.

Asset Finance Company (AFC)

An AFC is a financial institution which provides financing of physical assets supporting productive or economic aspects. The aspects include automobiles, tractors, lathe machines, cranes, generator sets, earth moving and material handling equipment, moving on own power and general purpose industrial machines. 

Investment Company (IC)

Investment Company is a financial institution whose principal business is into the acquisition of securities and investment.

Loan Company

A loan company is a financial institution which carries on its principal business of providing  finance in the form of loans or advances or otherwise for any activity other than its own like car loans.

Infrastructure Finance Company (IFC)

Infrastructure finance companies deploys almost 3/4s of their total assets in infrastructure loans. The net owned funds are more than 300 crores and the Capital to Risk-Weighted Assets Ratio is 15%.

NBFC-Factors:

NBFC Factors has a principal business of factoring. Factoring is nothing but a financial transaction and a type of debtor finance.

Gold Loan NBFCs in India

Over the years, gold loan NBFCs witnessed an upsurge in Indian financial market, owing mainly to the recent period of appreciation in gold price and consequent increase in the demand for a gold loans by majority especially the middle class to make both ends meet. Though there are many NBFCs offering gold loans in India, about 95 percent of the gold loan business is handled by three Kerala based companies. The growth of gold loan NBFCs occurred both in terms of the size of their balance sheet and their physical presence that compelled to increase their dependence on public funds including bank finance and non-convertible debentures.

Residuary Non-Banking Companies (RNBCs)

Residuary Non-Banking Company is a class of NBFC and is a company that has as its principal business as the receiving of deposits, under any scheme other than being an investment. These companies need to maintain investments as per rules and framworks of the RBI, in addition to liquid assets.

Thus these Nbfc companies for examplethe List of Nbfc Companies in Bangalore help a lot as these provide loans and securities to people which allows them to enjoy a happy life.

 

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on Jul 26, 18