Non-Banking Financial Companies in India: Reforms and Performance

Abstract:     
The purpose of this paper is to outline the working of Non-Banking Financial Companies in India as an important element of the Indian financial system based on their role for which various committees were set up to ensure financial discipline among the players with Reserve Bank of India (RBI) playing a major regulatory role. A quantitative analytical study on the performance of NBFCs in India in terms of number of deposit taking NBFCs and their volume of deposits reveals that the NBFCs that played a greater role as one of elements of financial system till late nineties has gradually lost its significance because of the regulations like Entry norms and Prudential norms which came to ensure financial discipline among the players.

Keywords: Financial Companies, Regulatory Norms, Financial Discipline, Reforms

JEL Classification: L80

working papers series