Regtech Research on Non-Banking Finance Companies in India

Regtech Research Reports to understand the risk universe

The share of NBFCs in the total credit system of India is rising steadily. Slowdown in the lending by Public Sector Banks and the improved response time, innovative marketing and focussed product approach helped many of the NBFCs to flourish.

What is NBFC ?

NBFCs are regulated by Reserve Bank of India but are not covered under the Banking Regulation Act. These are the companies providing banking services like loans, credit facilities etc. They are restricted from taking any form of deposits from the general public. From the days of Chainrup Bhansali, Non Banking Finance Companies in India have been focus of controversy. Recently the NBFC sector was buzz with news related to IL&FS Failure.

However, after the Cobrapost exposed the irregularities in the Dewan Housing Finance Limited‘s portfolio, whole NBFC sector was shaken. Cobrapost highlighted the political donations made to various parties to create the sensation. Cobrapost also identified the issues such as conflict of interest. This was an eye opener for already struggling NBFC sector. These risks are sitting in all the major banks and Non Banking Finance companies. Regtechtimes, is starting the series of the reports to help the bankers and other stakeholders understand the complete gamut of risks including the Political Risks, Enforcement Risks and Regulatory Risks associated with the portfolio of the borrowers.

Read the Heightened Risk Research Report on DHFL.

These events expose the Non Banking Finance companies to the reputation risk. In order to avoid the further jolts, Regtechtimes built the automated risk identification reports for the Non Banking Finance Sector. These are detailed research reports which help the NBFC Sector to understand the universe of Risk.

Know the Portfolio

Regtechtimes research collect the data of borrowers from the various public domain sources. We use multiple technology tools to collect and analyse the data sets. RT Research reports create the loan portfolio of the corporate borrowers.

Understand the Risk Universe

Regulatory Technologies developed by Regtechtimes compiles the information about 12 different risks applicable to the Non-Banking finance companies. A single dashboard provides the complete picture of the risks associated with the borrowers of the NBFC. From Politically Exposed Persons in the Borrower Portfolio to the SEBI Banned entities hidden in the portfolio, these reports provide different pieces of valuable information in a single dashboard.

Political Contributions

Contributions made to the political parties is the indicator of the inclination of borrowers with the political ideologies. Some times these political donations create the reputation risk for the borrowers which affects the business and in turn the repayment capability of the borrowers.

Conflict of Interest

This is one of the finest reports which covers various regulations applicable to the Non Banking Finance Companies. It tries to identify the conflict of interest if any involved in the sanctioning of the loans.

Who Needs these Reports?

There are multiple stakeholders of the risk reports.

  • Banks which lend the Non Banking Finance companies may want to look at these reports to understand the quality of the assets of Non Banking Finance Companies borrowing money from them
  • Non Banking Finance Companies would like to understand the missing pieces of information and disclosures. When the companies lent money to the borrower, it is expected that the same would be disclosed according to accounting practices.
  • Management Consultants and Audit firms who wish work with these NBFCs may require these reports to perform the due diligence before they accept the  audit or consulting work.