Payouts to key management personnel in non-banking financial companies (NBFCs) are under the banking regulator's scrutiny. Top industry officials said this is a follow-through on the Reserve Bank of India's (RBI's) circular of April 29, 2022, which asked NBFCs in the "middle" and "upper" layer of its four-tiered scale-based regulatory (SBR) framework to put in place a board-approved compensation policy.
Making life easier for people, the Reserve Bank on Thursday allowed holders of pre-paid payment cards, to deposits school and college fees and pay taxes in addition to buying rail and air tickets within the prescribed limit of Rs 10,000.
The National Bank for Agriculture and Rural Development is launching a non-banking financial company targetting the microcredit space in the country.
The Reserve Bank of India on Tuesday banned chartered accountant firm Haribhakti & Co LLP from undertaking any type of audit assignments for regulated entities for a period of two years starting April 1, 2022.
The exit of the big movers has meant more opportunities for local players such as Nambiar Finance, which is just one of the 1,465 non-deposit-taking NBFCs registered with the Mumbai office of the Reserve Bank of India.
In FY24, loans given out by such firms had topped a whopping Rs 146,517 crore, up by 49 per cent year-on-year and spread over 10.19 million accounts (up 35 per cent).
Stocks in the automotive, financial, cement, metal, and hotel sectors are likely to benefit if the Narendra Modi-led Bharatiya Janata Party (BJP) comes back to power for a third time. The key investment themes have been identified after analysing the Sankalp Patra - the party's manifesto for the next five years - released on Sunday.
With the difference between lending rates of banks and NBFCs narrowing, base your choice on urgency of requirement.
Non-banking entities such as fintech firms will have to tap into use cases beyond peer-to-peer (P2P) and peer-to-merchant (P2M) transactions to scale up the presence of the retail version of the central bank digital currency (CBDC), which is also known as the e, said industry players. These use cases will enable programmable transactions across domains, including the government's direct benefit transfer (DBT) schemes, with subsidies restricted to specific purposes such as food coupons, hospital bills, fertilisers, pesticides, and cross-border remittances.
Highly-rated finance firms and housing finance companies are expected to benefit from the absence of Housing Development Finance Corp (HDFC) from the bond market once it merges with the HDFC Bank in early FY24. Post merger, the bond market is expected to become less crowded, which will ease fund raising conditions for other players in the field. It may perhaps also compress the spread for debt instruments floated by housing finance companies (HFCs) over 10-year government bonds, subject to demand and supply conditions.
The Income-tax department has conducted searches at multiple premises of Chinese telecom company Huawei in the country as part of a tax evasion investigation, official sources said on Wednesday. The raids were launched at the company's premises in Delhi, Gurugram (Haryana) and Bengaluru in Karnataka on Tuesday. Sources said the officials looked at financial documents, account books and company records as part of a tax evasion investigation against the company, its Indian businesses and overseas transactions.
The pace of lending to the infrastructure sector, including power and roads, fell sharply to 1.8 per cent year-on-year (YoY) in May, 2023 compared to 9.8 per cent in May, 2022. Within the segment, the growth in loans to the power sector was at 0.3 per cent YoY in May 2023, down from 9.3 per cent in May 2022. The RBI data showed that outstanding credit to power sector stood at Rs 6.17 trillion in May.
Financing against gold being a secured form of lending and higher margins are key reasons.
Banks are gaining market share at the expense of non-bank lenders such as housing finance companies, retail lenders, and those giving gold loans. There has been a steady decline in the market share of non-banking financial companies (NBFCs) in the credit market as banks have stepped up lending. NBFCs' share declined to a five-year low of 19.8 per cent in the first half of FY23, down from 20.3 per cent in H1FY22, and an all-time high of 23.1 per cent in H1FY19.
Real estate investment trusts (Reits) are in talks with regulatory bodies - the Securities and Exchange Board of India (Sebi) and the Reserve Bank of India (RBI) - to seek changes in regulations that will allow easier access to capital. The Indian Reits Association (IRA) said it has approached the market regulator seeking to get classified as an 'equity' asset, which will open the path for their inclusion in equity indices and also make investment by mutual funds (MFs) easier. The association is also in active discussions with the RBI to allow banks to lend to a Reit.
The Enforcement Directorate on Thursday said it has frozen assets worth Rs 143 crore of prominent Kerala-based NBFC Manappuram Finance Ltd's MD and CEO V P Nandakumar after it conducted raids as part of a money laundering investigation. A total of six premises in Thrissur, where the company is headquartered, were covered during the searches that were launched on Wednesday. The case pertains to allegations of money laundering through "illegal" collection of deposits from the public, the agency said in a statement.
The Credit Suisse on Thursday said that it has received a license from the Reserve Bank of India to establish a bank branch in Mumbai.
A Supreme Court Bench headed by Justice Altamas Kabir on Monday dismissed the bail plea of investment banker Nimesh Kampani.
The Reserve Bank of India (RBI) on Monday issued new norms to regulate the fast-growing pre-paid cards industry and asked all the entities to comply with the guidelines within three months.
The top 50 exposures, amounting to Rs 7.8 trillion, of government-registered non-banking financial companies (G-NBFCs) constitute about 40 per cent of corporate credit within the NBFC sector, indicating concentration risk, according to the Reserve Bank of India's report "Trend and Progress of Banking in India 2022-23". Notably, all the 50 are tied to the power sector, a domain fraught with inherent challenges, the report said. The report highlighted recognising the escalating systemic importance of G-NBFCs, the Prompt Corrective Action (PCA) framework had been expanded to include G-NBFCs excluding those falling within the base layer.
Promoters of 517 companies have pledged nearly 46.35 per cent of their shares, the highest since the 2008 global financial crisis.
Fixed maturity plans, which have garnered Rs 102,133 crore (Rs 1021.33 billion) of average assets under management, are facing the prospect of rising defaults on their investments in the real estate and non-banking financial companies. This implies that if there are redemption pressures from their corporate and retail clients, these FMPs would have to raise cash from other resources to meet the demand.
While both institutions provide financial assistance, there are significant differences between them in terms of offerings, eligibility criteria, interest rates, and other crucial factors.
The Reserve Bank of India has told parliamentarians that it is concerned over the stock market exposure of various non-banking financial companies (NBFCs) promoted by leading banks in the country.
The fund will promote domestic shipbuilding of all types and sizes to reduce India's dependence on foreign ships.
The banking sector emerged as an outlier when the rest of India Inc witnessed a slowdown in earnings in FY23. The combined net profit of listed public and private sector banks was up 39.4 per cent year-on-year (YoY) last financial year and their share in India's gross value added (GVA) or gross domestic product (GDP) at factor cost rose to a record high of nearly 1 per cent up, from 0.8 per cent a year ago. Listed banks' combined net profit grew to Rs 2.36 trillion in FY23, from Rs 1.69 trillion a year ago. In comparison, India GVA at current prices was up 15.2 per cent YoY at Rs 247 trillion in FY23; it was around Rs 214 trillion a year ago.
Foreign institutional investors (FIIs) have brought in capital to the tune of Rs 26,000 crore (Rs 260 billion) in India till December 2007, the government said.Finance Minister P Chidambaram, however, insisted that it was not a "massive infusion" considering the size of the Indian economy.
The Reserve Bank of India (RBI) raised the minimum capital requirement for so-called shadow banks and tightened rules on deposits and bad loans to avoid any potential risk to the economy from these rapidly growing finance firms by regulating them like traditional banks.
People are availing far more of certain kinds of unsecured loans than was the case before the pandemic. Bank lending for buying consumer durables and funding of credit cards and other personal loans have risen by Rs 6.9 trillion between August 2019 and August 2023, shows a Business Standard analysis of data from the Reserve Bank of India (RBI). These loans are typically unsecured, which means they are provided without collateral.
'It is advisable to stay away from the markets for now and buy only on a dip.'
The board of directors of NBFCs have been advised to formulate policies and procedures to operationalise and ensure the observance of these guidelines, which come into immediate effect, in respect of all new customers, the bank said.
Lenders of debt-ridden Reliance Capital have voted in favour of a resolution plan submitted by Hinduja Group firm IndusInd International Holdings Ltd (IIHL) which made the highest cash offer of Rs 9,661 crore in the second round of bidding. As much as 99 per cent votes were in favour of IIHL as lenders expected to recover cash upfront of Rs 9,661 crore from the Hinduja Group entity, sources said. Besides, sources said cash balance with Reliance Capital (RCAP) of over Rs 500 crore would also go to lenders. So, in all lenders are expected to receive about Rs 10,200 crore for distribution as against Rs 16,000 crore principal secured debt, resulting in 65 per cent recovery for the lenders, sources said.
A lower risk appetite among investors has driven gold, traditionally a safe-haven asset, to record highs so far this year. Fuelled by geopolitical tensions in West Asia, robust demand from central banks - particularly in Asia - and US President Donald Trump's tariff volleys, spot gold touched an all-time high of $2,956 per ounce on February 24 in the international markets.
The central bank's tough new rules spell major changes in the competitive landscape for financial services audits.
'One of the aspects for transparency and fair governance is to give the industry being represented the chance of lobbying with the regulator.'
The country's largest commercial bank State Bank of India is likely to go for stake sale by December as a part of its efforts to mobilise Rs 50,000 crore (Rs 500 billion) in the next three years.
