Summary

The NBFC ecosystem in India has evolved over the years, and the Reserve Bank of India and the Government of India's policies have helped the sector emerge stronger and more resilient than before. The CAFRAL_Report aims to highlight the unique opportunities and challenges that confront NBFCs in the Indian context, with a focus on financial inclusion, interlinkages between the nonbanking sector and other segments of the financial system, digitalization and its impact, and emerging balance of risks for the sector. The report is organized into four chapters and is sensitive to the significant heterogeneity within NBFCs, issues in complementarity and competitiveness vis-à-vis the traditional banking sector, and the growing synergies between NBFCs and FinTech, particularly in reaching out to sections of society that get excluded from formal credit markets.