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In recent years, our economy has faced various banking frauds done by large corporate houses, which creates a big crisis for the financial sector.
Due to those frauds done by renowned fraudsters, it also becomes difficult for a common man to avail of financing facilities from banks, as most of the banks started making stringent norms for every person proposed to avail finance from banks.
To resolve this issue, and also to provide smooth and affordable financial services, Non-banking financial companies (NBFCs) are playing a crucial role in our economy in recent years.
In recent years, a big development in financing options is made by Non-banking financial companies (NBFCs) by offering multiple kinds of products especially for financing vehicles and for fulfilling housing Loan requirements for a person.
The detailed discussion about the financing of Vehicle and Housing Loans by Non-banking financial company (NBFCs) is explained herein below.
Non-banking financial company (NBFC) is a company which is engaged in the business of providing various kinds of loan and advances and various other services to individuals and body corporates.
To Carry on the Business of Non-banking financial company (NBFC), the Company must hold a Certificate of Registration from Reserve Bank of India.
In the present scenario, a Non-banking financial company (NBFC) is acting as an alternative to banks as such NBFC provides financial services similar to that of the banks and also provides financial solutions to the unorganized part of the society.
Generally, Non-banking financial companies (NBFCs) are not allowed to accept demand deposits from the public, such as those in checking or savings accounts, which keeps all NBFCs outside the scope of conventional oversight from Central and state financial regulators.
With the rise of non-banking financial corporations (NBFCs) in India, the choice has only gotten wider as customers can now choose not only among banks but also NBFCs.
Today credit is not just a via media to aspirational fulfilments of the individual; it is a booster dose for the industry.
Keeping this in view, Non-banking financial company (NBFCs) being a financial institution, offers various kinds of Loan Products, which includes the following:
Apart from the Products mentioned above, a Non-banking financial company (NBFCs) offers various other innovative Products, which includes Flexi Products i.e. combination of More than one product.
Nowadays, the vehicle becomes an essential article for one’s life. Owning a Vehicle according to one’s needs, makes his life more comfortable and also helps to fulfil his requirement to commute or to use his vehicle for his business or personal purposes.
One can use his vehicle for any purpose instead of using public transportation and also to use his vehicle for leisure or for enjoying weekends.
One of the restraint in buying the vehicle is the lack of financial resources. Most of the people were not able to buy a vehicle due to the non-fulfilment of financial demand that the Banks were not able to fulfil due to certain eligibility criteria in some cases, especially in the case of those people who were working in the unorganized sector.
Non-banking financial companies (NBFCs) resolve the financial problem faced by people to a great extent.
The existence of various Non-banking financial companies (NBFCs) opens up large avenues for people desirous of buying a vehicle.
NBFC Sector boosts the vehicle loan sector in recent years.
Availability of Multiple Non-banking financial companies (NBFCs) offering various kinds of financial products with innovative schemes offers multiple advantages to the proposed vehicle owners.
Also, Read: Analysis of NBFC Liquidity Crunch in NBFC Sector.
Some of the benefits are as follows:
House is a basic necessity of every person which provides a permanent roof for himself and his family. Everyone wishes to have a house where he and his family can live together with joy and happiness.
For any person, buying a house is a very important decision which involves considerable financial planning. One of the important facilitator that most of the people adopt while buying a house is to take a home loan, whether from any bank or any other financial institution.
As buying a house involves a considerable investment for everyone, so it becomes important for everyone to choose a proper model for fulfilling his financial requirement for buying a house.
The existence of a Non-banking financial company (NBFCs) opens up new avenues in the real estate sector for the proposed buyers to raise finance for the purpose of fulfilling his financing required for buying a house.
In recent years the trend for financing Housing Loans is being shifted from banks to Non-banking financial companies (NBFCs).
Due to dedicated services, ease of financing and customer satisfaction provided by NBFC as observed by the housing Loan borrowers in the market, this sector has gained its significance in the finance industry.
Financing of Housing Loan from Non-banking financial company (NBFCs) also offers various other benefits to the buyers, which are as follows:
The entire finance sector is a service-led industry. All Banks and financial institutions, including Non-banking financial company, work very hard to fulfil the Vehicle, Housing Loan and other financing requirements of every individual.
However, with due motive customer satisfaction and dedicated and smooth service in providing Vehicle and Housing Loan, NBFCs can out space banks.
Further, after banks become appraised about a large amount of fraud by big corporate houses, resulting in stringent norms for individuals to the financing requirement, NBFC helps our economy to boost finance especially in Vehicle and housing Loan Sector.
Dedicated workforce, easy finance conditions, availability of different financing products, easy documentation along with less processing fees provided by NBFCs helps our people to prefer NBFCs in various cases rather than Banks for fulfilling their financing requirements.
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