siliconindia | | MARCH 20249have not been of much help towards closing this gap and towards supply chain financing (SCF) for small businesses or corporates in need, various non-banking financial corporations (NBFCs) / fintechs are stepping up to do so. With the help of technology, NBFCs can leverage digital data and partnerships to ensure that the benefits of supply chain finance are extended to smaller businesses".AI & Robotics Reshape NBFC Lending: NBFCs are using technologies to make things better. Instead of the old `one size fits all' way of deciding who gets loans, they're now using AI and machine learning to understand each customer better. This helps them offer personalized loans to more people, especially those who might have been left out before. Some NBFCs are teaming up with tech companies to make their behind-the-scenes work faster and more organized. They're also using tech-like robots to do tasks quickly, helping them be more inclusive, save money, and make decisions faster. With advanced technology, they can even make quick decisions about loans and improve how they collect payments from customers. One big NBFC even introduced a special voice-powered chatbot in their app, using AI to help customers with personal loans from start to finish.Financial Protectors Boosting Economic GrowthNBFCs are like financial protectors, known for quickly helping people who need money urgently, which is great for people who need quick financial help. They've been a dynamic strength for financial system by reaching out to millions of small businesses and self-employed individuals. Besides helping MSMEs, NBFCs have played a dynamic role in the development of various economic sectors like housing, consumer goods, and transportation. They've been a key player in advancing the country's infrastructure by providing long-term funding for big projects. Their contribution to expanding credit goes beyond business loans to include microfinance, personal loans, and auto finance. In simple terms, NBFCs have been crucial in making financial services accessible and supporting the development of different sectors in the country.NBFCs ChallengesIn India, non-banking financial companies (NBFCs) are facing some hard tasks. One big issue is getting enough money. Like regular banks that have easy access to low-cost payments, NBFCs have to borrow money from banks or issue bonds to raise funds. This makes it difficult for them to offer interest rates as low as banks do. Another problem is dealing with complicated rules. Unlike banks that have simpler regulations to follow, NBFCs have to navigate through a confusing set of rules with different regulators overseeing different parts of the financial services industry. This complexity can be a big problem, especially for NBFCs that work in many states or regions.At the end The collaboration of traditional finance and Fintech holds promise for a future where digital skills and customer-focused strategies shape financial services. The ongoing journey aims for a more connected, efficient, and user-friendly financial system, drawing insights from both NBFCs and Fintech for the future of finance.
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