What are NBFCs? Which are India’s top NBFCs?

The non-banking financial companies (NBFCs) are those organizations regulated by the Department of Non-Banking Supervision (DNBS) of the Reserve Bank of India (RBI), which are allowed to extend credit services to consumers and businesses. The NBFCs have been offering their clientele products like loans, credit cards, insurance, investments, and other services.

Top 10 NBFCs in India in 2022

1. Tata Capital Financial Services Limited

Tata Capital is Tata group’s financial services arm and one of India’s best NBFCs. It provides a wide range of financial products and services to retail, corporate and institutional customers. Its product offerings include home, car, two-wheeler, personal, business, and other loans.

It also offers commercial finance for small and medium enterprises (SMEs), deposit products, wealth management services, insurance, and forex and international trade services. Tata Capital also has a presence in real estate financing through its wholly-owned subsidiary, TC Realty Finance Limited.

2. Bajaj Finance Limited

Bajaj Finance is one of the largest NBFCs in India, focusing on lending to individuals and small businesses. The company offers a range of financial products, including personal loans, home loans, two-wheeler loans, loans against property, SME loans, credit cards, and deposits. Bajaj Finance also provides its subsidiaries with OTC derivatives trading solutions and investment banking advisory services. In recent years, the company has made forays into the digital lending space with the launch of its mobile app ‘Bajaj Finserv Experia.’

3. Flexiloans

FlexiLoans is an online lending platform that offers collateral-free working capital loans & Business Loans to SMEs and MSMEs. The company disburses loans in a matter of hours, with minimal documentation. FlexiLoans has a network of over 1 million borrowers and has so far disbursed over INR 3,500 crore to more than 10,000 small businesses across India.

4. M&M Financial Services Limited

A part of the Mahindra Group, this company provides financing solutions to individuals and businesses. M&M Financial Services offers loans for two-wheelers, three-wheelers, four-wheelers, agriculture and construction equipment, as well as business loans. The company has a network of over 1,200 branches and 3,500 dealers/distributors across India.

5. L&T Finance Holdings Limited

L&T Finance Holdings is the financial services arm of engineering conglomerate Larsen & Toubro (L&T). The company provides various financing solutions, including retail, rural, infrastructure, and corporate finance. L&T Finance Holdings also offers deposit products such as fixed deposits (FDs) and recurring deposits (RDs). The company has a network of over 1,000 branches and 2,500 customer touchpoints across India.

6. Magma Fincorp Limited

Magma Fincorp is an NBFC focusing on lending to individuals and small businesses. The company offers a range of financial products, including personal loans, home loans, two-wheeler loans, loans against property, SME loans, credit cards, and deposits. Magma Fincorp also provides OTC derivatives trading solutions and investment banking advisory services through its subsidiaries. The company has recently entered the digital lending space with its ‘Magma Loans’ app.

7. Repco Home Finance Limited

Repco Home Finance is an NBFC that provides housing finance solutions to individuals, small businesses, and corporates. The company offers home loans, loans against property, construction finance, and deposit products such as fixed deposits (FDs) and recurring deposits (RDs). Repco Home Finance has a network of over 200 branches across India.

8. Cholamandalam Investment and Finance Company Limited

Cholamandalam Investment and Finance Company is an NBFC focusing on lending to individuals and small businesses. The company offers a range of financial products, including personal loans, home loans, two-wheeler loans, loans against property, SME loans, credit cards, and deposits. Cholamandalam also provides OTC derivatives trading solutions and investment banking advisory services through its subsidiaries.

9. HDB Financial Services

HDB Financial Services is a part of HDFC Bank and India’s leading NBFC in terms of market worth. It has a vast network throughout India. It offers its customers personal, home, business, and other financial products and services.

HDB Financial Services strongly focuses on customer service and offers its customers a wide range of value-added services.

10. Aditya Birla Capital Limited

Aditya Birla Capital is the financial services arm of the Aditya Birla Group, one of India’s leading business conglomerates. It is one of the largest NBFCs in India, providing various financial services, including retail, rural, infrastructure, and corporate finance. Aditya Birla Capital also offers deposit products such as fixed deposits (FDs) and recurring deposits (RDs). The company has a network of over 1,000 branches and 2,500 customer touchpoints across India.

The companies mentioned above are some of the best NBFCs in India.

The future of NBFCs – in the new normal

The COVID-19 pandemic has brought about unprecedented challenges for businesses across the world. The Indian economy has also been impacted adversely by the pandemic. The lockdown imposed to contain the spread of the virus has led to a sharp decline in economic activity.

However, it is essential to note that the impact of the pandemic on NBFCs has been relatively less compared to other sectors such as aviation, hospitality, and tourism. This is because NBFCs have a diversified customer base and are not reliant on a single industry for their growth.

It is expected that NBFCs will play a vital role in the country’s economic recovery. They are well-positioned to support the government’s initiatives such as ‘Make in India’, ‘Digital India’, and ‘Housing for All by 2022’.

NBFCs have also started adopting new technologies such as artificial intelligence (AI) and big data analytics to further improve their efficiency and performance. This will help them to better serve their customers and tap into new growth opportunities.

Conclusion

NBFCs play an essential role in developing the banking sector in India. They are well-positioned to support the government’s initiatives and contribute to the country’s economic recovery. 

In addition, NBFCs are adopting new technologies to improve their efficiency and performance. This will help them to better serve their customers and tap into new growth opportunities.

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