NBFC Lending

NBFC lending refers to the broad range of loan and credit products offered by non-banking financial companies in India, which operate under RBI regulation but are not licensed as full-service banks. NBFCs offer personal loans, business loans, loans against securities, microfinance, and credit cards — either directly or through co-origination and partnership arrangements with banks. NBFC lending is particularly important in the Indian financial ecosystem because it serves customers who are underserved or unserved by traditional banks, including those without extensive credit histories, fixed salary incomes, or property to offer as collateral. NBFC credit products often have more flexible eligibility criteria and faster disbursement timelines compared with bank loans, though the interest rates may be higher to compensate for the elevated credit risk. When an NBFC partners with a bank to issue a credit card, the bank provides the regulated card issuance infrastructure while the NBFC contributes its distribution reach and customer acquisition capabilities. Applicants for NBFC lending products should carefully review the interest rates, processing fees, prepayment charges, and other terms, as these can vary significantly between NBFCs and may differ from the standardised structures offered by public sector banks.