NBFCs outpace banks in credit growth in FY25: BCG Report
Non-Banking Financial Companies (NBFCs) have significantly outpaced commercial banks in credit growth during Fiscal Year 2025, according to a report by Boston Consulting Group (BCG).
The report reveals that NBFCs recorded a robust 20 per cent credit growth, a substantial margin over the 12 per cent growth observed in the banking sector. This accelerated expansion by NBFCs, particularly driven by the Gold
NBFC
category.
India's NBFC sector's total net advances mirrored this growth, also increasing by 20 per cent year-on-year to reach Rs24.5 lakh crore. This propelled the overall balance sheet size of the NBFC industry to Rs28.2 lakh crore, marking a 20 per cent rise from the previous fiscal year. Total borrowings by NBFCs also saw a significant uptick of 22 per cent to Rs19.9 lakh crore, reflecting increased funding activity to support their expanding operations.
by Taboola
by Taboola
Sponsored Links
Sponsored Links
Promoted Links
Promoted Links
You May Like
Villa For Sale in Dubai Might Surprise You
Villas in Dubai | Search ads
Learn More
Undo
The report also sheds light on other critical aspects of the NBFC sector's health. While overall profitability showed an 8 per cent year-on-year increase in absolute profit for the sector, the Microfinance Institutions (MFI) category faced a sharp decline in Profit After Tax (PAT) by 95 per cent.
This contrasts with the broader NBFC trend, where a marginal improvement in the Cost to Income ratio from 36.7 per cent in FY24 to 36.2 per cent in FY25 indicates enhanced operational efficiency.
Live Events
Asset quality for the NBFC sector improved marginally, with Gross Non-Performing Assets (GNPA) improving by 10 basis points from FY24. However, the MFI category did experience a rise in NPAs, despite the overall sector improvement.
Most NBFCs are well-capitalised, meaning they have enough financial reserves to handle potential risks, even if their capital levels saw a slight adjustment from the previous year.
Larger and more diverse NBFCs continue to be highly valued in the market. While banks have delivered better overall returns to investors in the last three years, the strong credit growth by NBFCs in FY25 suggests they will continue to play a vital role in India's financial system.
The way NBFCs get their funding is also changing; some are relying more on
bank loans
, while larger ones are looking more towards public deposits and other funding sources. Additionally, NBFCs are increasingly focusing on providing loans for personal needs and vehicles.
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Time of India
40 minutes ago
- Time of India
Despite May losses, bumper summer onion production this year in Nashik
Nashik: The summer onion production in Nashik district has shown a significant increase of 63% during the 2024-25 (Dec-April) season in comparison to the previous year. The state agriculture department reports that Nashik district's summer onion yield reached approximately 59 lakh tonnes in 2024-25, while the previous season (Dec-April of 2023-24) recorded 36 lakh tonnes. State agriculture department officials reported an increase in summer onion cultivation area from 1.4 lakh hectares in 2023-24 to 2.5 lakh hectares in 2024-25, with an average yield of 23.4 tonnes per hectare. Despite approximately 5% damage from May rainfall, the season produced abundant crops, ensuring an adequate supply until the next harvest in Oct. Unlike kharif and late kharif onions harvested between Oct and Feb, which deteriorate within a month, summer onions harvested in March-April maintain quality for six to seven months. This extended storage capability allows farmers to hold their produce and sell at APMCs when prices are favourable or when they require funds. The market relies on stored summer onions from May until mid-Oct, when fresh kharif crops arrive. Current wholesale price at the Lasalgaon APMC stands at Rs 1,600 per quintal, compared to Rs 1,500 per quintal during the same period last year. The expected wholesale price range is between Rs 1,400 and Rs 2,000 per quintal. by Taboola by Taboola Sponsored Links Sponsored Links Promoted Links Promoted Links You May Like New South Wales Pensioners Are Eligible For Invisible Hearing Aids Best Hearing Aids Undo "The cost of production for growing onions is around Rs 1,800 per quintal," states Bharat Dighole, the president of the Maharashtra Onion Growers' Association. With wholesale prices ranging between Rs 1,050 and Rs 1,600 per quintal over recent months, farmers face losses. Dighole advocated for a Rs 2,000 per quintal govt grant for farmers who sold their produce at a lower rate due to a drop in wholesale prices caused by faulty govt policies. Dighole further said Centre has already announced the procurement of 3 lakh tonnes under price stability funds to create a buffer stock through the central govt agencies — National Agricultural Co-operative Marketing Federation of India Ltd (Nafed) and the National Cooperative Consumers' Federation of India Limited (NCCF). "We want both the central govt agencies to procure onions directly from farmers at the APMCs at the price of Rs 3,000 per quintal," said Dighole. Follow more information on Air India plane crash in Ahmedabad here . Get real-time live updates on rescue operations and check full list of passengers onboard AI 171 .
Time of India
40 minutes ago
- Time of India
Shirdi's Saibaba Sansthan allows only flowers and garlands as offerings
Nashik: The Shree Saibaba Sansthan Trust in Shirdi has partially lifted its earlier restriction, now permitting devotees to offer flowers and garlands at the temple while maintaining restrictions on other items such as shawls and prasad. Sansthan CEO Gorakshanath Gadilkar said, "The committee has decided to allow flowers and garlands inside for offering. The temporary ban on various offerings was implemented on May 11 following threats of attack on the temple." The administration has set up new guidelines requiring devotees to present receipts from florists when bringing flowers or garlands into the temple. "Security personnel will verify these receipts. This will make it clear what items came from which florists, and at the same time, the receipts will also ensure the pilgrims are not duped," Gadilkar said. This measure addresses recent incidents where certain florists allegedly overcharged visitors, leading to formal police complaints. The new protocol aims to prevent such exploitation of devotees. The administration continues to uphold restrictions on prasad and shawl offerings until further notice. by Taboola by Taboola Sponsored Links Sponsored Links Promoted Links Promoted Links You May Like Pinga-Pinga e HBP? Tome isso 1x ao dia se tem mais de 40 anos Portal Saúde do Homem Clique aqui Undo District guardian minister Radhakrishna Vikhe Patil supported the decision to permit floral offerings, considering its impact on local farmers' livelihoods. A senior Sansthan official said while the committee implemented necessary security measures following the threat, which later turned out to be a hoax, the ban significantly affected farmers. The minister's concerns about farmers' welfare influenced the committee's decision to permit floral offerings, following a formal presentation. Follow more information on Air India plane crash in Ahmedabad here . Get real-time live updates on rescue operations and check full list of passengers onboard AI 171 .
Time of India
40 minutes ago
- Time of India
City footpaths choked as vendors return despite repeated evictions
Guwahati: Despite repeated eviction drives conducted by the Guwahati Municipal Corporation (GMC), street vendors continue to encroach upon footpaths and roadsides across multiple locations in the city, causing significant inconvenience to pedestrians and commuters. Ganeshguri remains one of the worst-affected areas, with unauthorised vendors setting up temporary stalls that obstruct pedestrian pathways and disrupt vehicular movement. In Bhangagarh and Jalukbari, several vendors have resumed business despite recent eviction drives. "We have carried out multiple eviction drives over the past few months, but vendors return within days. The situation is challenging because many depend on street vending for their livelihood, but we cannot compromise public safety and convenience," said Munindra Mahanta, GMC's enforcement officer. According to Mahanta, an ongoing eviction drive at Fancy Bazaar aims to curb repeated offences. Non-compliant vendors are either fined Rs 10,000 or have their stalls confiscated. "The situation at Jalukbari and Bhangagarh has improved. Next, we will begin evicting vendors from GS Road," he added. "I have to walk on the main road because the footpath is occupied by vendors. It is dangerous, especially during peak hours," said Manjit Talukdar, a private sector employee who uses the Ganeshguri route. by Taboola by Taboola Sponsored Links Sponsored Links Promoted Links Promoted Links You May Like Eat 1 Teaspoon Every Night, See What Happens A Week Later [Video] getfittoday Undo Cab driver Pankaj Bharali said, "The road narrows when vendors occupy sides. A permanent solution is needed." GMC mayor Mrigen Sarania acknowledged the ongoing challeng. "We understand the livelihood concerns of street vendors, but unauthorised encroachment disrupts mobility across the city. Our enforcement team has been instructed to act accordingly." Follow more information on Air India plane crash in Ahmedabad here . Get real-time live updates on rescue operations and check full list of passengers onboard AI 171 .
