What are the benefits of obtaining an NBFC License in India?

An NBFC License gives rise to a Non banking Financial Company. It is a business entity that provides non-banking financial services including:

1. Lending advances and business loans,
2. Acquiring shares, bonds, stock, debentures and securities
3. hire-purchase
4. Leasing
5. Clean chit business

In this article, we look at the various benefits of obtaining NBFC license in India.

But first, let us discuss the importance of a Non Banking Financial Company in India.

Why does an NBFC matter in the Indian economy?

Non Banking Financial Companies play a pivotal in developing India’s economic strength. Their benefits do not extend only to the services they provide. There are many game changing factors that an NBFC introduces that are crucial for any country.

1. Surpassing the Banking Sector: Between 2006-2013, NBFCs have surpassed India’s banking sector in terms of growth rate. Currently, compared to NBFC loan market is growing at the rate of 37.5 %, a figure that will only see more escalation in the future.
2. Profitability: The emphasis on most NBFCs being start-ups push the fact that starting a non banking financial entity is more cost effective than starting a Bank. As the returns for an NBFC are higher, we can further state that NBFCs are far more profitable. Read More: Section 8 Company Registration
3. Lending to the infrastructure projects: Unlike Banks, NBFCs are inclined towards risky endeavours such as lending loans for large infrastructural projects. Such projects are the foundation of our country’s economy – making a non banking financial an indispensible part of India’s economic growth.
4. Promotion of inclusive growth: India’s new vision for growth is steeped with inclusivity. An NBFC can help in realizing that dream. Assisting customers irrespective of their locations – rural or urban – these business entities are catering to all needs from small housing projects to large infrastructures.

Now that you are aware about the importance of a Non banking Financial Company, let us look at the benefits of getting NBFC license that has made all of this possible.

Benefits of obtaining an NBFC License

Getting the NBFC registration  means starting down a business path that can yield for you the following advantages:

1. Trading in Money market instruments: An NBFC can trade in Certificate of deposit, Bills of exchange, promissory notes, and other money market instruments more flexibly than a traditional bank.
2. Being an option when no banks can grant loans: Unlike banks, the lending criteria for a Non banking financial company are more relaxed. Even though they still have to maintain a certain standard, NBFCs won’t send away a person in need of loans if he or she has a less than perfect credit history.
3. Faster than traditional Banks: A Non banking Financial Entity is faster than a traditional bank. It can provide the services at an accelerated pace. And because it is motivated by profit, customers can pay more to expedite the processes.
4. Tech-oriented services: Those who have gone through the NBFC registration process can provide enhanced financial solutions by infusing them with tech-oriented services. Read More:  Insurance Marketing Firm

Conclusion

A Non banking Financial Company allows you to put a technological spin on the traditional banking services. It is important for India’s quest for financial growth. Thus, you can obtain NBFC license easily if you consult with the right experts. Contact Registrationwala for more info.

Why you should start a Non banking Financial Company in India? Know the answer to this question by taking a glance at why you should get an NBFC license.