What is the Full Form of NBFC?

2 minute read
NBFC full form

NBFC full form is Non-Banking Financial Companies. NBFCs are also known as nonbank financial institutions (NBFIs). These are financial institutions that though offer a range of banking services do not hold a banking license. All services that they provide are bank-like but they don’t have the power that banks hold in their functioning. An adjacent aspect of this establishment is that the banking regulations and authorisation of federal or state overseers do not apply to NBFCs. Some examples of NBFCs are insurance companies, hedge funds, P2P lenders, mortgage lenders, money market funds, and investment banks. NBFCs play an important role to help meet the credit demand that traditional banks fail to meet. 

Pros and Cons of NBFCs 

Everything has its own pros and cons. NBFCs are no different. Though they provide substantial pros, there are also cons. Read the table below to know more. 

Pros  Cons
They are helpful for people as they act as an alternate source of credit. They are absent from oversight as they are non-regulated.
Intermediaries are eliminated here, improving the communication channel with the clients.  The operations here are non-transparent. 
Investors obtain high yields  The presence of a financial risk, be it towards the economy or the financial system

Top NBFCs in India 

Which NBCs in India are on the top? The list is shared below!

  • Bajaj Finance
  • Bajaj Holdings
  • Muthoot Finance
  • Shriram Trans
  • M&M Financial
  • Sundaram Fin
  • Motilal Oswal
  • CreditAccess Grameen Limited 
  • Satin Credit
Source: Imarticus Learning on Youtube

We hope this has helped you understand the NBFC full form and everything related to it. Do you want to know more full forms like this? In the world of short forms, you can rely on our page to know more! Discover more such short forms that can help enhance your general knowledge!

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