NBFCs would do well to avoid term lending in the coming 9/12 months and stick to lending thru the Supply chain financing route to push liquidity to existing customers against their purchases of raw materials / key services and also focus on the receivables financing for them . This will…
The last week has been symbolically eventful for the BFSI sector. The first news that caught attention was RBI’s direction to Kotak Bank to stop on boarding new customers through its online and mobile banking channels and also stop issuing fresh credit cards. The bank can continue servicing existing customers…
Recently analysed data from CBDT published in The MINT shows that direct tax collection as a share of gross domestic product had reached an all-time high of 6.1% in FY 2023. The share of direct taxes as a proportion of overall tax revenue had reached 54.6 pc as against indirect…
Supply Chain Finance has been the key area of focus for Fintechs and NBFCs. Transaction based working capital financing with underlying trade of products and services, the self-liquidating nature of the financing arrangement with short tenures make it a favourite product for working capital financing. The introduction of GST and…
Possible impact on the Digital Lending ecosystem and Regulated Entities (REs) The recommendations of the RBI initiated working group on Digital Lending – Implementation, should be welcome by the financial sector participants for an orderly digital transformation without elevating systemic and social risks. The objective is laudable but the challenge…
Deep Chain Financing for MSMEs My Piece written on Supply Chain Financing post pandemic . Check out the link The Pandemic – Supply Chain disruptions and lessons for SCF practitioners – FrankBanker written for Frankbanker. #MSMEfinance #Supplychainmanagement #supplychainfinance
Financialization of Housing – is it an evil which leads to deprivation and degradation of the poor in society, infringing on their right to housing and shelter? Or is it of great benefit in an open market economy which leads to movement of scarce capital to the sector which has…
I have been noticing that financial services lenders and banks take policy calls on not lending to a particular sector(s) at various points in time during economic and industry cycles. Some years back it was the steel industry and now the services and the hospitality sector. Does this stem from…
I had written on 27.03.20 that the loan moratorium announcement was done in haste in March 2020. The consequences of a hurriedly announced unplanned move was never really comprehended or possibly ignored in the interest of political expediency. The impact on banks and NBFCs , possibly the entire financial system…
Like Health and education, housing has seen subject of debates on whether universal approach or targeted approach is the way out for providing housing to all in a country. Universal approach, where housing is provided by the state irrespective of social or economic status has been followed by small countries…
In all the years that I have been Consulting and Training in the Retail Lending space especially in the MSME sector I have always felt the need for NBFCs /Banks to look at consultative approach rather than product centric approach to MSME lending. Covid has now made it imperative for…