New Delhi, September 26, 2026 (Yes Punjab News)
Reserve Bank of India (RBI) Deputy Governor Shirish Chandra Murmu has outlined five key areas for the sustainable growth of non-banking financial companies (NBFCs) and housing finance companies (HFCs) as their role evolves from alternative lenders to specialised financial partners.
NBFC credit currently accounts for 16.7 per cent of nominal GDP, up from 15.9 per cent a year earlier. It also represents about 27 per cent of credit extended by Scheduled Commercial Banks, compared with 26 per cent previously.
In the September edition of the RBI Bulletin, Murmu identified governance, liquidity management, asset quality, customer trust and digital transformation with cyber resilience as key areas for the sector.
On governance, he said boards and senior management must build a culture of sustained compliance and ethics across organisations as the sector expands.
Liquidity management was identified as the second priority. Murmu noted that past liquidity events had highlighted the exposure of NBFCs and HFCs to shifts in market sentiment and concentrated funding sources. He called for diversification of funding and said a deeper and more liquid corporate bond market would support the sector.
He also said securitisation should evolve beyond being a liquidity tool into a mechanism for genuine risk transfer and capital release, supported by appropriate skin-in-the-game and transparency requirements.
On asset quality, Murmu stressed the need for rigorous stress testing, early-warning systems and dynamic provisioning as credit growth accelerates. He also encouraged greater use of artificial intelligence and machine learning to identify early signs of borrower stress.
“Growth must never come at the cost of underwriting standards,” he said.
Murmu identified customer trust as another fundamental requirement, stressing that innovation should not outpace customer protection, particularly for vulnerable borrowers. Conduct regulation, grievance redressal and responsible lending, he said, remain priorities.
The fifth area is digital transformation and cyber resilience. Murmu said technology adoption should deepen across areas such as blockchain-based supply chain finance and AI-enabled fraud detection, while NBFCs must strengthen cybersecurity to protect customer data and maintain trust.
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