Non-Banking Finance Companies(NBFC’s) will play a crucial role in providing credit to MSME’s. These companies will increase the growth of credit to MSME’s by over 12-14 % in the next 5 years. As of March 2017, overall credit to MSME’s stood at Rs. 16 trillion.

The share of Non-Banking Finance Companies in MSME credit is set to rise to 23 % by March 2022 compared to around 16% in March 2017. NBFC’s cater to niche segments and have a product that is specifically designed for MSME’s. The unmet demand in the MSME segment is estimated to be Rs. 25 trillion in FY2017.

Apply for MSME Loan

The NPA for NBFC’s stood at 3% in March 2017, as compared to banks which have an NPA of 8.4%. NBFC’s typically offer low ticket loans to mitigate risk and have a customized credit rating process for MSME’s. These factors allow them to maintain good asset quality.

Source: The Times of India

Want to read the latest posts on social media? Then follow us on FacebookTwitter, or LinkedIn!

To read more about how Non-Banking  Finance Companies provide credit To MSME’s, Click Here.

See also  Everything You Should Know About Loan Scheme By Modi