“A research study on the performance of NBFC’s based

on customer satisfaction w.r.t Muthoot Finance in Navi

Mumbai”

Dissertation Submitted to the

D.y. Patil Deemed to be University School of Management
In partial fulfillment of the requirements for the award of the
degree of
BACHELORS OF BUSINESS ADMINISTRATION

Submitted by:
Rajat Singh Rathore
Roll No. BBA017208

Submitted to:
Dr. Sonia Justin
D.Y. Patil University Deemed to be university School of
Management
CBD Belapur, Navi Mumbai.

March 2019

1|Page
“A research study on the performance of NBFC’s based
on customer satisfaction w.r.t Muthoot Finance in Navi
Mumbai”

Dissertation Submitted to the

D.y. Patil Deemed to be University School of Management
In partial fulfillment of the requirements for the award of the
degree of
BACHELORS OF BUSINESS ADMINISTRATION

Submitted by:
Rajat Singh Rathore
Roll No. BBA017208

Submitted to:
Dr. Sonia Justin
D.Y. Patil University Deemed to be university School of
Management
CBD Belapur, Navi Mumbai.

March 2019

2|Page
 DECLARATION

I hereby declare that the dissertation “A research study on the performance

of NBFC’s based on customer satisfaction w.r.t Muthoot Finance in
Navi Mumbai” submitted for the Full time BBA Degree at Dr. D.Y. Patil Deemed
to be University School of Management is my original work and the dissertation has
not formed the basis for the award of any degree, associate ship, fellowship or any
other similar titles.

SIGNATURE OF THE STUDENT

PLACE: Mumbai

DATE:

3|Page
 CERTIFICATE

This is to certify that the dissertation entitled “A research study on the

performance of NBFC’s based on customer satisfaction w.r.t
Muthoot Finance in Navi Mumbai” is the bona fide research work carried
out by Mr. Rajat Singh Rathore, student of Full time BBA, at D.Y. Patil Deemed to
be University’s School of Management during the year 2017-2020, in partial
fulfilment of the requirements for the award of the Degree of Bachelors in Business
Management and that the dissertation has not formed the basis for the award
previously of any degree, diploma, associate ship, fellowship or any other similar
title.

Dr. Sonia Justin Dr. R. Gopal

Director & HOD
D.Y.Patil University D.Y.Patil University
School of Management School of Management

Place: Mumbai
Date:

4|Page
 ACKNOWLEDGEMENT

In the first place, I thank the Dr. D. Y. Patil Deemed to be University, School of
Management, Navi Mumbai for giving me an opportunity to work on this project. I
would also like to thank Dr. R. Gopal (Director & HOD) & Dr. Sonia Justin and
D.Y. Patil Deemed to be University School of Management, Navi Mumbai for
having given me his/her valuable guidance for the project. Without his/her help it
would have been impossible for me to complete the project. I would be failing in
my duty if I do not acknowledge with a deep sense of gratitude the sacrifices made
by my parents and thus have helped me in completing the project work successfully.

SIGNATURE OF THE STUDENT

PLACE: Mumbai

DATE

5|Page
 CONTENT

CHAPTER TITLE PAGE

NO NO
A LIST OF TABLE
B LIST OF FIGURES
C LIST OF ABBREVIATIONS
EXECUTIVE SUMMARY
1 INTRODUCTION
2 OBJECTIVE OF THE STUDY
2.1 NEED FOR STUDY
2.2 SCOPE OF STUDY
3 LITERATURE REVIEW
4 RESEARCH METHODOLOGY
4.1 DATA COLLECTION METHOD
4.2 SAMPLING METHOD
4.3 LIMITATIONS OF STUDY
5 COMPANY PROFILE
6 DATA ANALYSIS AND INTERPRETATION
7 CONCLUSION
8 FINDINGS OF THE STUDY
9 RECOMMENDATION AND SUGGESTIONS
10 ANNEXURE
10.1 QUESTIONNAIRE
10.2 BIBLIOGRAPHY

6|Page
 LIST OF TABLES

Table Table Explanation Page Number

No.

7|Page
 LIST OF FIGURES
Figure Figure Explanation Page
No Number

8|Page
 LIST OF ABBREVATIONS

NBFC Non-Banking Financial Companies

M&M Mahindra and Mahindra
ISBN International Standard Book Number
EMIs Equated Monthly Instalments
IDFC Infrastructure Development Finance Company
RBI Reserve Bank Of India
IDF Intermediate Distribution Frame
MFI Micro Finance Institutions
DNBS Department Of Non-Banking Supervision
NBFI Non-Banking Financial Institution
FDI Foreign Direct Investment
FII Foreign Institutional Investor
FPP Full Packaged Product
IRDA Insurance Regulatory And Development Authority
MCA Master Of Computer Application
NOF National Opportunities Fund
HUDCO The Housing And Urban Development Corporation
Limited
RNBC Residuary Non-Banking Companies
MNBC Micro Nano Breakthrough Conference
CIBIL Credit Information Bureau India Limited
COR Change Of Responsibility
SME Small And Medium
PPP Public Private Partnership
GDP Gross Domestic Product
HFC Housing Financing Companies
CRB Certified Residential Broker
NCD Negotiable Certificate Of Deposit
HDFC Housing Development Finance Corporation
HBD Housing And Development Board
FICCI Federation Of Indian Chambers Of Commerce And
Industry
CII Confederation Of Indian Industry
CRICIL Credit Rating Information Services Of India Limited

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 Executive summary
NBFCs (Non-Banking monetary companies) play an vital position in figuring out the economic
increase. they have get right of entry to to large markets and provide financing for almost all sports.
suppose of buying an car, and one will discover financing corporations that offer EMIs at the
doorstep. assume of buying any electronics, one might be surprised the number of financing
companies that you'll technique to make a deal. thus the competitiveness of the groups combined
with fierce penetration throughout the period of the usa permits NBFCs to grow at a fast tempo.

The look at offers a comparative have a look at of NBFC’s in Navi Mumbai with admire to
Muthoot Finance. There are nearly 13000 registered NBFC’s in India. The have a look at is aimed
to offer an holistic view of the NBFC enterprise. NBFC fulfills the monetary hole with the aid of
offering loan at a lower rate of interest.

The fundamental players of each discipline :-

1) Housing Finance industry: LIC Housing Finance.

2) Infrastructure Finance enterprise: IDFC

3) Asset Financing: Shriram delivery Finance

4) Composite: Reliance Capital

5) Gold mortgage : Mudhoot Finance

The study also as compared the Indian Banks v/s NBFC and find out the differences between the
Banks and NBFC. It become located that at even on the time of the economic slowdown NBFC
became more profitable. A survey in performed to know the performance of NBFC based on the
consumer pleasure . The enterprise is not tightly regulated as there are numerous regulatory bodies.
hence, there was an essential need to look at the NBFC because the industry plays an critical role
in the monetary services market of Navi Mumbai .

It is encouraging that the NBFC zone‘s significance is eventually being stated throughout market
elements in addition to the regulator.

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 INTRODUCTION

Non-Banking Financial Companies ('NBFCs') are money related foundations which are not banks,
however they acknowledge stores and complete capacities like banks. NBFCs collected the
consideration of the Reserve Bank of India ('RBI') when a few contributors lost their cash, amid
the disappointment of a few banks in the late 1950s and mid1960s. So as to keep the expansive
number of contributors, RBI started managing them by presenting Chapter IIIB in the Reserve
Bank of India Act, 1934. In March 1996, there were around 41,000 NBFCs in India and they were
not perceived as a different class. Be that as it may, because of the disappointment of a portion of
the foundations the administrative structure alongside the detailing and supervision was tightened
by RBI. In the late 90s, far reaching developments were brought to secure the enthusiasm of
investors and guaranteeing the ideal working of NBFCs.

The capital prerequisite was changed in the year 1999, NBFCs getting enlisted on or after the
issuance of notice dated April 21, 19991 were required to have the base net possessed assets of '
200 lakhs so as to initiate the matter of a NBFC. Due to snowballing pattern in the area and to
guarantee the development of the segment in a sound and proficient way different administrative
measures were taken for distinguishing the fundamentally essential organizations and bringing
them under the severe standards. The NBFC-ND with resource size of ' 100crores or more were
viewed as foundationally imperative organizations. Amid the FY 2011-12, two new classes of
NBFCs were presented viz., IDF and MFI. In September 2012, another classification of NBFC-

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Factors was presented and three separate guidelines were presented for managing these
classifications. The RBI vide its public statement 2013-2014/1931 dated April 1, 20142 suspended
crisp enlistment of NBFCs which was inspired vide its official statement 20142015/952 dated
November 10, 20143. So as to change the segment, whole administrative structure was
investigated and round on modified administrative system was issued on November 10, 2014, with
a warning to pursue. The guidelines were in accordance with the suggestions made by the advisory
group on Issues and Concerns in the NBFC Sector, led by Smt. Usha Thorat and the Committee
on Comprehensive Financial Services for Small Businesses and Low-Income Households, led by
Dr. Nachiket Mor. In March 27, 20154 the most anticipated warnings were issued correcting the
net claimed finance necessities, Acceptance of Public Deposits Directions, 1998, Deposit
Accepting or Holding Prudential Norms Directions, 2007, Factor Directions, 2012 and issued two
new bearings viz. NBFC-ND-NSI Prudential Norms Directions, 2015 and NBFC-ND-SI
Prudential Norms Directions, 2015.

Meaning

An NBFC is a enterprise registered underneath the businesses Act, 1956 ('Act, 1956') or agencies
Act, 2013 ('Act, 2013') and is engaged inside the business of financial institution. section 45I (f)
of the RBI Act, 1934 defines ''non-banking financial corporation'' as -
(i) a economic organization that is a organisation; (ii) a non-banking organization which is a
enterprise and which has as its major business the receiving of deposits, beneath any scheme or
arrangement or in any other way, or lending in any manner; (iii) such other non-banking group or
magnificence of such establishments, as the bank may additionally, with the previous approval of
the vital authorities and through notification inside the professional Gazette, specify;

Section 45I(c) of the RBI Act, 1934 defines the term “financial institution” as -

‘‘economic institution’’ method any non-banking group which carries on as its enterprise or a part
of its commercial enterprise any of the following activities, particularly:–
(i) The financing, whether or not by way of making loans or advances or otherwise, of any hobby
apart from its very own.
(ii) The purchase of shares, inventory, bonds, debentures or securities issued by means of a
government or nearby authority or other marketable securities of a like nature.
(iii) Tetting or handing over of any goods to a hirer beneath a hire-buy agreement as described in
clause (c) of segment 2 of the rent-purchase act, 1972.
(iv) The carrying on of any elegance of insurance enterprise.

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(v) handling, accomplishing or supervising, as foreman, agent or in any other potential, of chits as
defined in any law that is in the intervening time in pressure in any kingdom, or any business,
which has similarities thereto.
(vi) Collecting, for any purpose or under any scheme or arrangement by whatever name called,
monies in lump sum or otherwise, by way of subscriptions or by sale of units, or other instruments
or in any other manner and awarding prizes or gifts, whether in cash or kind, or disbursing monies
in any other way, to persons from whom monies are collected or to any other person, but does not
include any institution, which carries on as its principal business,–

(a) agricultural operations; or (a) industrial activity; or

(b) the purchase or sale of any goods (other than securities) or the providing of any services; or

(c) the purchase, construction or sale of immovable property, so however, that no portion of the
income of the institution is derived from the financing of purchases, constructions or sales of
immovable property by other persons.

The Companies which falls outside the purview of the definition - financial institution those
companies are known as non-banking non-financial companies. Also, the term principal business
has not been defined by RBI. However, there are various ruling which emphasize on the various
parameters viz. past history of the party, current and past year's deployment of the capital, breakup
of the income earned during the relevant and past years, the nature of activities and the intent of
the party. In order to identify a particular company as an NBFC, RBI came with a principal
business criteria.

50-50 criteria

RBI vide its press release 1998-99/1269 dated April 8, 19995, laid down the criteria for
determining the principality of business (popularly known as 50-50 principal business criteria).
The asset and income pattern as evidenced from the last audited balance sheet of the company
shall be considered. The following criteria shall be satisfied by a company to be known as an
NBFC -

 Financial assets are more than 50 per cent of its total assets (netted off by intangible assets)
and
 Income from financial assets should be more than 50 per cent of the gross income.

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The aforementioned criteria is a thumb rule for determining whether a company qualifies to be an
NBFC. The conditions are cumulative, that is, both the tests are required to be satisfied
simultaneously as the determinant factor for principal business of a company.

Based on the above press release, the RBI came with another circular no. DNBS (PD) C.C. No.
81/03.05.002/2006-07 dated October 18, 20066, insisting NBFCs to obtain an annual certificate
from the auditor of the company certifying that the company continues to carry on the business of
NBFI and is fulfilling the criteria of the principal business as detailed in the press release dated
April 8, 1999.

Banks vs. NBFCs

NBFCs activities are akin to that of Banks. However, below mentioned are few differences-:

 NBFC can't acknowledge request stores;

 NBFCs don't shape some portion of the installment and settlement framework and can't
issue checks drawn on itself;
 store protection office of Deposit Insurance and Credit Guarantee Corporation isn't
accessible to investors of NBFCs, dissimilar to if there should arise an occurrence of banks;
 NBFCs don't have control under SARFAESI;
 100 percent FDI in NBFCs is permitted under the programmed course in 18 determined
exercises, subject to least capitalisation standards;
 74 percent (incl. speculation by FIIs/FPIs) FDI allowed in private part - banking, 49
percent under programmed course and past 49 percent and up to 74 percent under
endorsement course.

Multi-regulator model

In evaluation to united kingdom, India takes a shot at a multi-controller display. There are sure
elegance of NBFCs directed with the aid of unique controllers are exempted from the
prerequisite of enrollment beneath segment 45-IA of the RBI Act,1934 with RBI.

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Figure 1 :- Multi-Regulatory Model

Financial Organisations which do not need a NBFC license:

There are certain entities which might be involved in the commercial enterprise of monetary
activities however do now not require to achieve a registration with the Reserve financial
institution of India (RBI). As those entities are regulated by means of other monetary zone
regulators, they do no longer want both of the NBFC registration or the NBFC guidelines of RBI.
these entities are as follows:

• Insurance groups which are regulated by coverage Regulatory and development

Authority of India (IRDA)

• Housing Finance companies which can be regulated through the country wide

Housing bank

• Inventory broker organizations that are regulated by Securities and alternate

Board of India

• Service provider Banking groups which might be regulated by using Securities and

alternate Board of India

• Mutual funds which might be regulated through Securities and change Board of

India

• Task Capital corporations that are regulated by using Securities and exchange

15 | P a g e
 Board of India

• Companies that run Collective investment Schemes that are regulated by means

of Securities and alternate Board of India

• Chit Fund companies that are regulated through the respective kingdom

Governments

• Nidhi agencies which can be regulated by way of the Ministry of company Affairs

(MCA)

The different types of NBFCs:

1. The NBFCs may be categorised beneath broad heads:

2. On the nature of their pastime
3. On the basis of deposits
4. The unique kinds of Non-Banking financial companies or NBFCs are as follows:
5. On the nature of their activity:
o Asset Finance Company
o Loan Company
o Mortgage Guarantee Company
o Investment Company
o Core Investment Company
o Infrastructure Finance Company
o Micro Finance Company
o Housing Finance Company
6. On the basis of deposits:
o Deposit accepting Non-Banking Financial Corporations
o Non-deposit accepting Non-Banking Financial Corporations
Equipment Leasing and Hire Purchase Finance Companies
The ceiling of public deposits as a multiple of internet owned fund (NOF) in recognize of system
leasing and lease buy finance organizations has been more desirable. equipment leasing and lease
buy finance having score of minimal investment grade have also now been allowed to get
admission to public deposits.
The revised limits are as beneath:

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 Level of rating Existing limits Enhanced limits
(As a multiple of NOF)

AAA 3 times 2 times

AA 1 time 4 times

A 2.5 times 1.5 times

Minimum investment grade i.e.

A-(CRISIL and ICRA)
BBB (CARE)
BBB (DCR India) NIL 0.5 times

The requirement of rating and degree of public deposits for loan and funding corporations
stays unchanged.
The question that arises is whether those establishments pose any opposition for the industrial
banks. there may be no smooth answer to this query. As those institutions do no longer usually
receive call for deposits, they do no longer compete with banks in that discipline. with regard
to time deposits, but, because the go back offered by them is higher, a few diversion from
banks to those corporations can not be altogether dominated out. The Banking fee had talked
about that a part of their funds represents activisation of foreign money balances. The loan
commercial enterprise of these establishments is supplementary/complementary to that of
banks. They provide loans to debtors and for functions which can be avoided or inadequately
catered to with the aid of the banks. a good deal interest has been paid in India to the hassle
of regulating and controlling those institutions for 2 reasons,
(a) Their managements have occasionally been found to be cheating, and depositors' interest
has been ignored,
(b) by giving loans for the cause of hypothesis and hoarding, they have tended to undermine
the dreams of monetary policy within the united states. approximately 4485 investment
groups had total sources of the order of Rs.7354 crore at their disposal in the yr 1994. The

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 volume in their assets is expected to have been approximately Rs.l3800 crore in 1996.
Gorden, E and k.Natarajan, financial Maricets, Himalaya Publishing residence, New Delhi,
2003.

HIRE PURCHASE FINANCE COMPANIES

Commonly, the two phrases—hire purchase credit and instalment credit score—are used
synonymously. The 2 however, vary technically, in that within the case of the former the
ownership of the best in query is not transferred to the consumer till he clears all dues, even
as in the case of the latter, once the mortgage settlement is signed the possession is right now
transferred to the customer. We shall additionally use the 2 terms interchangeably some other
time period that is used on this context is client credit. It is a idea with constrained scope
comparison with the opposite simply indicated due to the fact, strictly talking, it covers credit
score for financing sales and purchases of purchaser items and offerings handiest. Hire
purchase credit score can be customer credit score or business credit.
Rent purchase credit score may be supplied by way of the seller himself or by any monetary
group. Whilst the vendor provides such credit score, his resources of price range may be his
personal capital or borrowings from positive monetary institutions. Extra ordinary types of
financial institutions such as banks and sales finance businesses have now entered the
business of rent purchase finance. They may provide instalment loans in opposition to the
stocks of goods of wholesale traders. Such loans are easy and unsecured advances, and,
consequently, tend to have a very high value for the borrower. This technique of financing
dealers is now not very famous. Alternatively, monetary institutions might also cut price or
buy instalment receivables on an outright foundation. This is rendered possible due to the fact
instalment contracts are transferable and negotiable.

LEASE FINANCE COMPANIES

A rent is a financing device which has developed unexpectedly at some point of the Nineteen
Sixties and Nineteen Seventies inside the usaand in India just before the middle of the 1980s.
It's far a shape of financing hired to collect using assets. Through rent, companies can

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 accumulate the monetary use of belongings for a stated period of time without proudly owning
it. Every lease includes components—the user of the asset called the lessee, and the proprietor
of the asset known as the lessor.

There are two foremost forms of rentals:

 Running lease and
 Monetary or capital hire. The operating lease is a brief term lease which may be
cancelled via giving right notice at the option of the lessee.
Economic lessee is a non cancelable contractual commitment at the a part of
the lessee to make a chain of payments to the lessor for the use of an asset. it may be cancelled
handiest if the lessor is reimbursed for any losses. The rent
price is a set obligation which, if not met, will cause monetary insolvency of the lessee.
The monetary lease might also take the following paperwork:
I. Sale and hire again. In this case the company sells an asset it owns to some other party
which rentals it back to the previous
II. Direct rent. right here a employer acquires the use of an asset at once from the
manufacturers,
III. Leveraged rent
In this case, three events not the usual are worried in the arrangement. The 3 events are the
lesser, the lessee, and the lender. Even though there may be some distinction between the hire
and hire buy credit depending upon the sort of contract, in essence, both of them is pretty
similar. Leasing is stated to be the forerunner of the increase of patron credit score commercial
enterprise. Leasing is likewise a producer income-aid, a marketing tool which helps the
manufacturers to hold manipulate of the market and clients.

HOUSING FINANCE COMPANIES

Housing is one of the fundamental requirements of guy, and the capital required in step with
dwelling is so large that few individuals can improve it from their personal savings. There
may be therefore a splendid need and scope for the improvement of arrangements for
presenting loans or finance for the motive of residence creation. However, for a few reason
or different, the refuge sector of the Indian monetary machine remained fully underdeveloped
until the Quit of the 1980s. The shortage of good enough institutional supply of credit for

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 residence building was pressured as an important hole in the method of financial improvement
in India. Within the recent past, the government have initiated certain steps to bridge this gap.

HUDCO
HUDCO is an vital organization in this vicinity. It was set up in April 1970 with the particular
reason of providing loans for refuge. It's been financing housing initiatives located in the
regions where there is a keen call for not handiest for homes but additionally for industrial
and business sites. It has been providing loan loans to cooperative housing societies
additionally. Its loans are to the extent of 60 consistent with cent of the price of the houses,
and the maturity length of its loans is between eight to ten years. It is able to be stated that
fifty five according to cent of HUDCO loans are earmarked for economically weaker sections
and coffee income institution households except 15 in step with cent of general loans are
earmarked for rural regions. As a result a major part of HUDCO lending is at subsidized
charges of hobby. Upto the stop of March 1990 HUDCO had cumulatively sanctioned and
distributed loans of Rs.4220 crore and Rs.2789 crore respectively. It distributed loans of
Rs.270 crore, Rs.325 crore, and Rs.522 crore in l986-87, 1987-88, and 1988-89 respectively.

THE STATE HOUSING FINANCE SOCIETIES

The state Housing Finance Societies (SHFSs) represent some other important supply of
finances in the residential mortgage market. These societies enhance loans to the affiliated
number one Cooperative Housing .The State Housing Finance Societies (SHFSs) constitute
another major source of funds in the residential mortgage market. These societies advance
loans to the affiliated Primary Cooperative Housing Societies for construction of dwelling
houses, purchase of land, additions and improvements to existing houses, purchase of houses,
and repayment of earlier mortgage debt. The terms and conditions of loans vary somewhat
from state to state; they also vary with the location of these, the borrower's income group and
the purpose of loan within the state. The maximum amount of a loan varies between 65 to 80
per cent of the value of the land and buildings, or some specified maximum amount,
whichever is lower. Societies for creation of living houses, buy of land, additions and
enhancements to present homes, buy of homes, and reimbursement of in advance mortgage
debt. The terms and situations of loans range relatively from nation to nation; additionally
they range with the place of those, the borrower's income organization and the purpose of
mortgage in the nation. The most amount of a loan varies among sixty five to eighty in line

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 with cent of the fee of the land and buildings, or a few distinct most amount, whichever is
lower.

MUTUAL BENEFIT FINANCIAL COMPANIES

Mutual advantage financial companies or nidhis, as they're acknowledged in
India are public restrained joint stock groups running specially in South India, mainly in
Tamilnadu. They're antique establishments, a number of which have existed for seventy five
to a hundred years. Out of 123 nidhis in 1995, ninety seven were in Tamilnadu of which 70
have been in Chennai city by myself. a number of them perform via the community of
branches. Maximum of them difficulty shares of denomination of Re.l and nobody besides
promoters and administrators can keep multiple share. They've a massive membership
varying from 1000 to 200000. But their share capital may be very small. The resources of
their funds are percentage capital, deposits from their members, and deposits from the public.
The deposits they receive are fixed and ordinary deposits. Unlike different NBFIs, nidhis
additionally be given call for deposits to some extent. They also borrow from banks. They
may additionally drift special schemes for widows, pensioners and so on.

RESIDUARY NON-BANKING COMPANIES

Residuary non-banking agencies (RNBCs) normally tap the public savings by means of
working deposit schemes akin to ordinary deposit schemes of the banks. Mobilisation of
deposits is effected from a large range of small and uninformed depositors through expressly
promising them that their money might be invested in banks and authorities securities. the
gathering of deposits is executed on the door steps of depositors thru field personnel who's
paid a big commission. These businesses get the funds at low price for longer phrases, and
installation them at fairly high yields. A lot of these corporations function with meager capital.
There are not any regulations on the quantum of deposits they are able to boost. They've
certain adverse capabilities; terrible networth in a few cases; no longer submitting periodic
returns to the regulatory authority; absence of designation of their banks by some of them;
and their mushroom boom. The combination deposits held by means of them as on 31 March
1990 had been approximately Rs.900 crore, i.e. akin to those of MNBCs and extra than those
of MBFCs.

MONEYLENDERS

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The unorganized sector in the Indian financial system consists of money-creditors, indigenous
banks, Nidhis, and chit budget. The vital Banking Enquiry Committee has classified cash-lenders
into expert and non-expert money-creditors. Professional cash-creditors are the ones who have
taken up cash-lending as the only profession. The expert money-creditors are referred to as
Mahajan or Sahukar. Non-expert money lenders are the ones who have taken money-lending as
considered one of their agencies, further to their fundamental commercial enterprise/profession.
Non-professional money creditors are merchants, buyers, landlords who carry on their career
however also lend out their surplus funds for earnings. Money-creditors do now not receive
deposits. They lend their owned price range without bothering an awful lot approximately the
purpose of the mortgage. In villages, loans are made on the basis of accept as true with and
confidence. Best within the case of a extensive quantity, the cash-lender insists on conditional loan
of landed belongings. He often collects his interest in type after the harvest. He does no longer
hold normal account books. The agreement between the cash-lender and the borrower is very
flexible. In case, the borrower needs cash even earlier than the adulthood of the mortgage, the
cash-lender does now not hesitate to lend them and renew their mortgage settlement. So long as
they consider that this loan is safe, they do now not compel them to pay back. However the price
of interest is quite high. In lots of cases, it's been talked about via the Enquiry Committee that the
hobby has handed the primary.

CHIT FUNDS
The Chit Fund is one of the financing businesses in India. It became very populat one time in
Tamilnadu and Kerala and has unfold over to North India. Chit fiinds may also be referred to as
Kuri. They acquire normal subscription from their participants and distribute the same amongst
themselves.

Chit funds are normally categorized into easy Chit, Prize Chit and business nowadays, the non-
banking finance companies (NBFCs) have emerged as substantial individuals to the Indian
financial increase by using supplementing the efforts of banks and other improvement financial
institutions. They play a key function within the course of financial savings and investment. in the
wake of speedy industrial development and liberalization of the economic region, the
entrepreneurs, company area as well as the key financial institutions have diversified their sports
to cater to the particular desires of the financial system. on this context, the important thing
monetary institutions and specialists have promoted monetary institutions to create a different and
competitive economic machine.

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 The NBFCs, when compared to industrial and cooperative banks are a heterogeneous group of
finance corporations. these agencies additionally intermediate among the savers and the traders.
The NBFCs in advanced nations have grown phenomenally and are now coming up in a huge way
in the developing international locations like Brazil, India, Jordan, Korea and Malaysia. The
specific classes, of the NBFCs include mortgage groups, funding businesses, lease purchase
finance corporations, system leasing companies, mutual gain finance corporations, miscellaneous
finance agencies, miscellaneous non-banking groups, residuary non-banking companies and
housing finance companies.Requirements to be fulfilled in order to obtain NBFC license:

The fundamental necessities which can be to be fulfilled with the intention to follow for NBFC
license are as follows:
 The employer has to be registered underneath the companies Act. This is the organisation
should either be a restricted business enterprise or a personal confined company (p.c).
 The minimum internet Owned Fund of the company should be Rs.2 crore.

CONDITIONS FOR NBFCs

Non Banking Finance companies which have applied to the Reserve financial institution of India
for grant of certificates of Registration under segment forty five-1A of RBI Act on or earlier
than July 9, 1997 however have internet owned fund (NOF) underneath Rs.25 lakh are directed
to notice that: the ultimate date for attaining the minimal statutory NOF restrict of Rs.25 lakhs
has expired on January 9, 2000. RBI will no longer in the normal direction furnish extension of
time to the NBFCs that have not attained the minimum NOF through January nine, 2000 and
their packages for certificates of Registration not be taken into consideration. NBFCs that have
attained the NOF OF Rs.25 lakh as on January 9, 2000 must record to the RBI right away
however now not later than April 10, 2000.therefore, NBFCs which have now not attained the
minimum NOF until January nine, 2000 should:
(a) Stop the enterprise of NBFC at once and inform the RBI of such
(b) discontinuance not receive or renew public deposits
(c) Repay the deposits already usual, as consistent with the phrases and situations of
deposits and
(d) Keep to conform with the provisions of chapter III-B of the Reserve bank of India Act
and the instructions issued there below till all deposits are repaid,
(e) NBFCs and unincorporated bodies are not allowed to use the call of RBI in
any way

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Documents that are to be furnished for incorporation of a NBFC:

The following files need to be submitted a good way to follow and gain a NBFC license:

 Details about the agency's management.

 Licensed replica of certificate of Incorporation
 Licensed copy of certificates of commencement of commercial enterprise
 Licensed reproduction of up to date Memorandum of affiliation (MoA) of the
organisation
 Licensed copy of up to date Articles of association (AoA) of the organization
 Reproduction of the PAN or CIN that has been issued to the agency
 Directors’ profile which must be duly filled and signed by means of each director
separately
 Certificate of enjoy from the non-banking economic groups at which every director
had labored and received revel in
 The CIBIL records applicable to the directors of the enterprise
 The closing 2 years' monetary statements of the relevant unincorporated bodies, if
any.
 A Board decision to approve the contents of the software and its submission
procedure, and the authorising signatory
 A Board decision to announce that -
 No public deposit has been prevalent through the organization previously (mention
the time period)
 No public deposits are held by using the company till date and no deposits can be
widely wide-spread thereafter without previous permission from the Reserve bank
of India in writing
 A Board decision specifying that -
 No NBFC activities are being carried on by way of the enterprise
 The company has stopped all forms of NBFC operations and will now not perform
the equal with out receiving registration from the Reserve financial institution of
India.

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  That allows you to formulate the 'fair Practices Code', a certified reproduction of Board
decision is required.
 A Statutory Auditors certificates certifying -
 that the employer isn't maintaining any Public Deposit
 That the organization does now not hold any Public Deposit
 A Statutory Auditors certificates which certifies that the enterprise is not worried in
any NBFC operation
 A Statutory Auditors certificate which certifies the internet owned fund as on the
application date
 Authorised share Capital info
 Info of the recent styles of the shareholding of the employer at the side of its probabilities.
 Copies of fixed Deposit receipt & bankers certificates of no loans/money owed with
account balances helping internet Owned budget
 The branch or financial institution's full postal address, credit score or mortgage facilities,
financial institution account and stability information, and so forth taken by the
corporation.
 For current businesses, the remaining three years' profit & Loss account,audited balance
sheet, auditors and directors' reports, etc. are to be submitted.
 The following 3 years' marketing strategy of the organization with info which includes:
 The particular direction of the business
 Marketplace section
 Earnings/asset sample declaration sans public deposits, cash flow declaration, and
projected stability sheets
 Documentary evidence of the company's startup capital source
 IT Returns or financial institution statements to be submitted post self-attestation apart
from these, the applicant might also must publish other additional files as required

Process of incorporation of a Non-Banking Financial Corporation (NBFC):

The step-by-step technique of incorporating a Non-Banking monetary organisation (NBFC) is

discussed below:

 The agency should have a valid registration beneath the businesses Act, 1956 or the
businesses Act, 2013.

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  The organisation have to have a minimum net owned budget well worth Rs.2 crore.
 At least one of the directors has to be of the equal heritage or needs to be a Senior Banker.
This Director also has to be a complete-time director inside the business enterprise.
 The business enterprise must have a clean CIBIL report.
 As soon as the conditions which can be noted above are met, the applicant can follow for
the incorporation through the website of the Reserve bank of India.
 A web application has to be filled up and submitted thru the RBI website.
 In conjunction with the shape, the applicant is required to add the requisite files on the
online portal.

As soon as all the above-stated steps are completed, a CARN range may be generated.

 The applicant is likewise required to send a hard replica of the application which is filled
up and submitted at the portal, to a local branch workplace of the Reserve bank of India.
 The license may be issued to the enterprise, after the thorough scrutinisation of the
software.

Guidelines prescribed by the Reserve Bank of India (RBI) that are to be followed by the
Non-Banking Financial Corporations (NBFC):

The features of the NBFCs in India are supervised by using the Reserve bank of India (RBI).
therefore, the NBFCs ought to abide via the pointers recommend with the aid of the RBI in chapter
III B of the RBI Act of 1934. The policies prescribed by means of the RBI are as follows:

 NBFCs can not receive call for deposits from public depositors or buyers as it isn't
authorised by way of regulation.
 The minimal time period for which the public deposits may be taken by way of the
company is 12 months, while the maximum tenure may be 60 months.
 The Reserve financial institution of India will now not assure the repayment of any
quantity which is taken with the aid of the NBFCs.
 The business enterprise can not fee an hobby charge that's greater than the rate prescribed
by using the Reserve financial institution of India.
 NBFCs can issue cheques to their clients on the way to make payments or settlements.
 The organization has to grant a file of the statutory go back on the deposits taken by using
the enterprise within the shape NBS- 1 every yr.

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  The employer has to supply a quarterly return at the liquid assets of the business enterprise.
 The audited balance sheet of the employer has to be submitted each yr.
 The business enterprise has to examine its credit score ratings each 6 months and post the
identical to the RBI.
 The agencies that have a Public Deposit of Rs.20 Crore or greater or have assets really
worth Rs.100 Crore or greater will need to publish a half-yearly ALM return.
 The depositors of the NBFCs can not avail the securing facility of the Deposit coverage
and credit score guarantee business enterprise (DICGC).
 simplest the NBFCs that have been duly rated and suits the encouraged minimum funding
Grade credit score (MIGC) rating, are eligible to simply accept conditional deposits from
public depositors.
 The RBI has restrained the NBFCs from offering extra blessings, extra incentives, or items
to the clients or depositors, than the ones which can be offered by the banks.
 The enterprise has to keep a minimum of 15% of the general public Deposits in its Liquid
property.

What precautions should a depositor take before placing deposit with an NBFC?

A depositor trying to area deposit with an NBFC ought to take the following precautions before
setting deposits:

1. That the NBFC is registered with RBI and specifically authorized by the RBI to just accept
deposits. A list of deposit taking NBFCs entitled to simply accept deposits is available at
www.rbi.org.in. The depositor have to take a look at the list of NBFCs approved to just
accept public deposits and also test that it isn't always appearing inside the list of
companies prohibited from accepting deposits.
2. NBFCs should prominently display the certificates of Registration (CoR) issued by way
of the Reserve bank on its site. This certificates need to additionally replicate that the
NBFC has been particularly authorized by using RBI to just accept deposits. Depositors
need to scrutinize the certificates to make sure that the NBFC is permitted to just accept
deposits.
3. The most interest rate that an NBFC will pay to a depositor need to no longer exceed
12.five%. The Reserve bank continues changing the hobby fees depending on the macro-

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 monetary environment. The Reserve financial institution publishes the change inside the
hobby costs on www.rbi.org.in → Sitemap → NBFC listing → FAQs.
4. The depositor need to insist on a proper receipt for every amount of deposit placed with
the company. The receipt must be duly signed by using an officer authorized by means of
the enterprise and need to kingdom the date of the deposit, the call of the depositor, the
quantity in phrases and figures, fee of interest payable, adulthood date and amount.
5. within the case of agents/sellers etc accumulating public deposits on behalf of NBFCs, the
depositors should fulfill themselves that the brokers/sellers are duly authorized via the
NBFC.
6. The depositor should undergo in mind that public deposits are unsecured and Deposit
insurance facility isn't always to be had to depositors of NBFCs.
7. The Reserve financial institution of India does not receive any duty or guarantee about the
existing function as to the financial soundness of the agency or for the correctness of any
of the statements or representations made or evaluations expressed by way of the
organization and for repayment of deposits/discharge of the liabilities by means of the
company

How do NBFCs facilitate Economic Development?

1. Greater Employment Opportunities and Standard of Living

NBFCs assist achieve the goal of macroeconomic rules of making more jobs within us . By selling
SMEs and personal industries thru lending them loans. This increase in new companies therefore
increases the call for for manpower and creates employment. Furthermore, the purchasing energy
Parity (PPP) of people rises and so does their standard of residing.

2. Strengthening of Financial Market

Rotation of assets, asset distribution and regulation of profits to shape the economic improvement.
They permit changing saving into investments and as a result helps within the mobilisation of
funds/ The economic marketplace relies closely on Non-banking monetary establishments for
raising capital. The start-u.s.a.and small-sized companies are depending on budget offered via
NBFCs and also a good way to preserve liquidity. For an powerful functioning and stability within
the financial marketplace, NBFCs play a widespread role.

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3. Supplying long-term credits

Not like the everyday banks, NBFCs increase long-term credits to infrastructure, commerce and
exchange businesses. The conventional banks count on well timed, schedules and brief-term
compensation of loans that won't always fit the necessities of those industries. NBFCs,
alternatively, fund massive tasks and so promotes economic increase. In addition they allow
industries to participate in equity.

4. Mobilisation of Funds

Non-banking financial companies help in mobilisation of funds in the economy.

5. Growth of National Income

As NBFCs purpose to construct capital for several industries – non-public and in any other case –
they resource in amassing a capital inventory for the us of a. This directly adds directly to the
country wide profits and results within the progression of Gross home Product (GDP).

PROBLEMS FACED BY NBFC IN INDIA

one of the essential problem faces by way of NBFC is lack of accept as true with. despite the fact
that registration of NBFC is obligatory from RBI. but a few organization offers fake registration
certificate and get worried in scams and make money out of human beings’s consider. human
beings have a tendency to trust greater in banks as they find it more honest. also current scams in
NBFC have snatched away the agree with of not unusual human beings from NBFC. in the equal
way Delhi police has unearthed the rip-off of 3 directors of Rs.980 crore. 3 Fund raising has
progressively emerge as greater difficult and hard, particularly, for the small and medium sized
NBFCs. NBFCs commonly don't have any get admission to to low price price range. Banks can
easily enhance monetary assets at low value thru deposits, financial savings and current debts. but
being NBFC can not raise capital via deposits it commonly lack the supply of low value price
range. NBFC can not recover small loans of much less than Rs 1 crore below the SARFAESI Act
2002. earlier there were no norms concerning NBFC in SARFAESI Act. but in line with the recent
amendment NBFC with asset base of Rs. 500 crore and above can be covered beneath act touching
on instances of above 1 crore.

Role of NBFCs

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NBFCs like banks and different economic establishments act as intermediaries among the ultimate
savers and the ultimate borrowers. The purpose in their life derives from the reality that in an
economy there are surplus gadgets which save and deficit devices which are in want of such
financial savings and a mechanism is wanted to deliver the 2 together. Surplus gadgets (savers)
can lend to the deficit gadgets (debtors) directly. This, however, is normally inconvenient to each
the savers and debtors and is actually not the most efficient manner of float of funds between the
devices. With the mediation of economic institutions, there's a reduction in the degree of risks
involved and there is also a more efficient utilization of the assets within the financial system.
economic intermediaries can offer a greater reasonably priced service because of the economies
of scale, their expert knowledge and their ability to spread the risk over a huge quantity of gadgets.
therefore, their operations provide to the saver the blended benefits of better go back, lower risk
and liquidity. The borrowers alternatively also get a much wider desire as a result of
intermediation of financial establishments. it may be of relevance to observe that while the loans
granted by business banks are, by means of and huge, for commercial, business and agricultural
purposes, those granted by NBFCs are generally for shipping, buying and selling, acquisition of
durable patron items, purchase and restore of houses or just for simple intake. given that their
sports aren't controlled via financial authorities to the identical quantity as the ones of business
banks, the credit extended with the aid of NBFCs won't necessarily be in consonance with
countrywide goals and priorities. The most important characteristic of economic intermediaries is
to transfer the savings of surplus gadgets to deficit devices; as a result, they can play a useful role
in the financial system of the u . s . a .. To the extent that they help in monetizing the financial
system and moving unproductive economic property into productive property, they make a
contribution to the u . s .’s economic improvement. In truth, the nature and variety of monetary
establishments themselves have come to be measures of economic development of a rustic. The
Reserve financial institution of India professional committees identified the need of non banking
monetary businesses within the following areas: -development of sectors like delivery and
infrastructure -widespread employment generation -help and increase wealth creation - vast base
financial improvement -Irreplaceable supplement to financial institution credit score in rural
segments -predominant thrust on semi-city, rural regions and first time consumers/customers -To
finance economically weaker sections. -massive contribution to the state exchequer

Regulation of NBFCs

whilst NBFCs have been rendering many useful services, numerous advances, dangerous features
in their operating additionally were located. At gift all NBFCs besides HFCs are regulated by

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 means of the RBI. With enactment of RBI (amendment) act 1997, they all with net owned budget
of ì.25Lakhs and above have to sign up with the RBI now. The BFS with the help of department
of supervision of the RBI began supervising NBFCs from July 1995. HFCs are regulated by using
NHB. The main regulatory provisions are:

I. The minimal internet really worth budget of 25 Lakh and the NBFC ought to acquire the
minimal internet really worth norm in 3 years or extended 3years more on the discretion
of RBI.
II. NBFCs ought to keep 10%and15% of their deposits in liquid belongings.
III. They ought to create reserve fund and transfer now not less than 20% of their internet
deposits to it each yr.
IV. The RBI directs them on issues of disclosures, prudential norms, credit, investments and
so on.
V. Nomination facility is to be had to depositors of those corporations.
VI. Unincorporated bodies engaged in economic activity can not take delivery of deposits from
the public from April, 1997.
VII. They have to obtain a minimal capital adequacy norm of eight% by using March, 1996.
VIII. They should attain a minimal credit score from any individual of 3 credit score agencies.

Number of different types of NBFCs in India

Year NBFC-D NBFC-ND-SI NBFC- ND TOTAL

2012-13 254 418 11553 12225
2013-14 241 465 11323 12029
2014-15 220 420 11202 11842
2015-16 202 209 11271 11682
2016-17 178 218 11126 11522
2017-18 156 249 10997 11402

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FACTOR

several factors have contributed to the rapid increase of NBFCs in India. complete law of the
banking machine on the only hand and the absence or noticeably decrease degree of regulation of
NBFCs on the alternative need to a huge extent contributed to this improvement.

Recognising the importance of the NBFC sector and the want to combine it with the mainstream
economic device, the RBI has been taking steps occasionally for the regulation of NBFCs.
experience over the ultimate 3 a long time has proven that in advance rules covered most effective
the deposit taking sports of NBFCs with out appropriately covering elements of purposeful range
of those corporations and increasing intermediation with the aid of them. various committees,
which went into these elements, strongly recommended that there must be the appropriate
regulatory framework for NBFCs and that extra powers need to be vested with RBI to modify
them in an powerful way

PROBLEMS OF NBFCs

The brand new guidelines announced through the RBI are welcome in positive factors as it is
necessary to have higher capital adequacy norms and additionally better control of budget.
however there's pressured thinking about how NBFCs need to mobilize assets and growth their
hire buy and leasing enterprise. The failure of CRB business enterprise and the fiasco following
default with the aid of many nidhis in their responsibilities to depositors have manifestly been
liable for the financial government to take a extreme view of the operations of NBFCs.

however, the cutting-edge movements are in robust assessment with those followed in in advance
years whilst it changed into mentioned that NBFCs should mobilize assets on their own and not
rely to any tremendous extent on financial institution finance or time period loans from financial
institutions. The ratios for accepting deposits from the public with regards to owned budget had
been liberally conceived and only these days AAA groups have been allowed to just accept
deposits or restoration interest prices with out any restrict. the new conditions relating to the
reputation of deposits by using in a different way rated agencies will cause trouble to those which
have been placing extra reliance on deposit mobilization as opposed to on securing credit score
from banks. The latter also had been adopting a step-motherly mind-set in the direction of NBFCs
due to an impact that they had been competitors and transacting commercial enterprise with banks
finances which can have been dealt with through them. Judging by way of the reaction of the

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managements of even the higher located NBFCs, the ratios referring to deposits and internet
owned price range (NOFs) might must be revised for preventing a stunting of growth of those
NBFCs which have been functioning efficaciously and against whom there had been no
proceedings from depositors approximately payments on maturity date or everyday price of
interest expenses. besides a few establishments like Sundaram Finance, Lakshmi trendy Finance,
Cholamandalam funding, 20* Century Finance maximum others have extra deposits, which had
to be repaid before December 1998. apart from the fact, in addition increase can be ensured
simplest with higher cash credit limits and collecting of resources via NCDs . The compulsion to
refund excess deposits can also have nullifying consequences during the interregnum as
additionalresources raised in other kinds will ought to be applied for refunding excess deposits.

It has consequently been represented by using many NBFCs that the most ratios must be revised
to five instances of internet owned funds and a length of or three years should be allowed for
refunding excess deposits or effecting the essential adjustments. If the scope for securing price
range within the preferred manner is made available the financial government will have effective
supervision of the operations of the NBFCs worried and save you an growth in non-appearing
assets and help also the small and medium debtors to get their requirements from NBFCs without
undue delay at pretty affordable interest prices. given that NBFCs might also should play a extra
vital position whilst economic boom gets increased there could be need for larger volume of help
in opposition to rent buy and lease contracts. There need to for that reason be a pragmatic method
to splendid problems, as stated above, for securing a better coordination of the sports of banks
economic establishments, NBFCs and others.

GROWTH OF NON BANK FINANCIAL SERVICES

As the demand for economic offerings grows, international locations will need to inspire the
improvement of non-financial institution financial intermediaries and securities markets so as to
broaden the range of services and to stimulate competition and efficiency. India has made sizeable
progress toward greater different monetary systems.

The position of banks in non-bank economic offerings began to develop from the time of the
modification to the Banking law Act in 1983. Many service provider banking divisions and mutual
funds were set up by means of the general public area banks considering that then. Banks started
out to growth their non-financial institution and non funded enterprise which are known as
financial services. more these days some more tendencies befell to increase the scope for such
services:

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 I. Preserving open Indian capital marketplace to foreign economic institutions and foreign
places corporate our bodies to put money into India.
II. FERA dilution to encourage each the inflow and outflow of funds and foreign funding in
India, a number of which may circulate the inventory and capital markets.
III. Beginning up mutual fund enterprise and even banking to the non-public area. Already
some of private quarter businesses/companies are engaged in economic offerings, which
includes investment financing, rent buy, loan financing and housing finance and so on.
personal quarter turned into accredited to installation mutual funds, banks and monetary
establishments, economic deregulation, fi-eeing of interest charges on debentures, banks
lending prices and their practices and many others.

Top 10 NBFC Companies in india

1. Power Finance Corporation Limited

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Power Finance Corporation Limited, established in 1986 is a Navratna Status Company it's far
headed by way of Mukesh Kumar Goel. This business enterprise provides economic help to the
numerous electricity projects of India.

It helps the groups which might be concerned in energy technology, its transmission and
distribution. This organisation is indexed in Bombay inventory exchange (BSE) and country wide
inventory change (NSE).

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2. Shriram Transport Finance Company Limited

Shriram Transport Finance Company Limited is one of the best NBFCs which targets business
and commercial vehicles.

This company has been offering fund services for Heavy Duty Trucks, Light Duty Trucks,
Passenger Vehicles, Mini Trucks, Construction Vehicles as well as Farm Vehicles, since 1979.

3. Bajaj Finance Limited

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Bajaj Finance Limited is a part of Bajaj Holdings and investments and was founded in 2007; since
then it has emerged as one of the best NBFCs of India.

This company gives gold loans, domestic loans, individual loans, entrepreneur and enterprise
loans, and they also provide loans to doctors for their profession enhancement. moreover, it covers
trendy insurance, wealth advisory and cash lending.

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4. Mahindra & Mahindra Financial Services Limited

MMFSL became founded in 1991 and now it has extra than 1000 branches within the united states
and client base of three million which makes it one of the first-class NBFCs. This organisation has
affiliates which provide rural housing finance and coverage services.

Apart from these, it offers vehicle advances, gold advances, home credits, working capital
advances, corporate advances and more.

5. Muthoot Finance Ltd

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Muthoot Finance Ltd. is India’s very first NBFC established in 1888 in a small village of Kerala.
This is one of the best NBFCs in the country.

It gives loans in alternate for gold adorns, forex offerings, wealth control services, money
transfers, tourism and tour services. This company operates greater than 440 branches throughout
the united states of america and Muthoot Housing Finance is one among its units that provide
domestic loans.

6. HDB Financial Services

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HDFC bank operates HDB Finance offerings. It offers a extensive range of secured and non-
secured loans including enterprise loans, health practitioner loans, personal loans, vehicle loans,
credit loans, gold loans, tractor loans and plenty of greater.

HDB operates via a well-knit community of over one thousand branches spread during the us of
a. It has shown rapid growth inside the marketplace which makes it one of the satisfactory NBFCs
in India.

7. Cholamandalam Finance

Cholamandalam Investment and Finance Company Limited were established in 1978 as a unit of
Murugappa Group and it now has 725 branches all over India

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This enterprise began as an system financing service company which gives home loans, vehicle
finance, home fairness loans, funding advisory loans, SME loans and several different financial
services.

8. Tata Capital Financial Services Ltd

Tata Capital financial services Ltd. tops the listing of pleasant NBFCs. It become founded in 2007
as an arm of Tata Sons Ltd. it is a non-forestall provider of economic services that fulfil the desires
of retail, institutional and corporate clients of the u . s . a ..

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It makes a speciality of providing infrastructure management, wealth control, domestic loans,
commercial finance and customer loans. It additionally covers the distribution and the advertising
of Tata cards.

9. L & T Finance Limited

L&T Finance Limited is one of the strongest players in the financial sector. It was founded in 1991
with its headquarters in Mumbai.

This organization gives financial services to sectors inclusive of enterprise, alternate, and
agriculture; it makes a speciality of person loans, business loans, rural loans and car loans. It
become declared as ‘company of the yr’ in 2010 at financial instances Awards.

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10. Aditya Birla Finance Ltd.

Aditya Birla Finance restricted is an arm of Aditya Birla monetary offerings that become mounted
in 1991. RBI has registered ABFL as ‘a systemically essential non-deposit accepting NBFC’. It
ranks amongst the high-quality NBFCs in India.

It offers customized and precise solutions; from commercial mortgage to corporate finance and
from structured finance to capital markets.

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 Objectives of the study

1. To study the concept of Non-Banking Financial companies.

2. To understand the difference between NBFC and Banks.

3. To know how does new city establish itself with the NBFC.

4. To know success factor of NBFC in new city.

5. To analyse the challenges and opportunities of NBFC in new city.

6. To know the top NBFC which are preferred by people.

7. To know the role and functions of NBFC.

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 NEED OF THE STUDY

The proposed observe affords the whole lot wanted facts approximately the customer delight, that's
amassed through the researcher through way of primary records from the supply itself i.e. the
customers. The have a look at will highlight the application Muthoot Finance offerings. The study
can be useful to Mudhoot Finance in addition to to different NBFC. Because of time constraint it
isn't viable to cover over all regions . The study could be beneficial extra particularly to Muthoot
finance to understand the motives for the dissatisfaction among the customers and consequently
to take corrective steps in enhancing their services in addition. This observe will become a supply
of facts for future researchers to collect the facts and statistics on the premise of NBFC services
of Muthoot Finance, and client pride. The study additionally offers simple concept of the method
required to collect and examine the facts.

Scope for Research

In the process of globalization, India is a rapidly progressing economy. Sooner or later Navi
mumbai will have to provide mature regulations to its subjects (citizens) in order to retain the
human talent as well as to attract global human talent. The study on NBFCs will help to understand

45 | P a g e
how the progressive sectors are realizing the fact as well as which segments need to recognize the
same.

Within the current situation, due to an dynamic surroundings, the macro elements alternate due to
their linkage or inner reliance on other macro variables. In mild of those and to answer some
greater hypothesis regarding the effect of promoting on investments, the elements influencing
investment selections on NBFCs and need or in any other case of regulations are a few areas that
could entertain similarly studies it could be argued that to an quantity the over guidelines or rather
unplanned guidelines have inspired the boom of the arena. further research at the trends of Indian
NBFC enterprise with emerging economies together with China or other advancing economies
will be studied to provide greater strong path to the regulators and the enterprise.

Like several concern of studies, where lots of other supporting or counter theories are resulting
from any basic paintings, this issue is no exception.

LITERATURE REVIEW

From the motive of proposed research mission entitle ‘boom potentialities of Non- Banking
financial organizations in Navi Mumbai ’. I went through several books, journals, articles,
newspapers, dissertations and various reports published time to time. A number of them reviewed
are as following :-

Shollapur M.R in his article in ‘The Indian magazine of trade’ has revived concept of NBFCs.
As in step with him the abstract NBFCs constituted a huge a part of financial system and praise
the carrier offer by way of industrial bank in India. The performance of economic services and
flexibilities helped them build a big frame of client which include small borrower and larger
company status quo. The pace of financial liberalization has a intensified the opposition. As a
result, there has been a shift in the direction of strategic perspective advertising and marketing

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process of NBFCs. This angle allow them to expect the destiny impact of alternate and assist to
move out of week place and grab new opportunity through non-stop tracking machine.

R.M Srivastava & Divya Nigam in his e book control of Indian economic institution background
material for monetary increase and economic institution, kinds of financial organization, recent
fashion Indian economic marketplace. He placed enfaces at the fact that the money marketplace
has passed thru a section of substantial adjustment and advancement in current year.

C Shekhar & Lakshmy Shekhar in his e book has explain position of NBFCs in India has shown
speedy development specifically in 1990 attributable to their excessive diploma of orientation
closer to customers and implication of segment requirement. The role of NBFCs as powerful
financial intermediaries stand up has been nicely recognized as they've inherent abilities to take
faster decision, count on risk and customize their services furnished by means of bank and market
the components on a conceptual basis.

E. N. Murty shows the benefit and outlook of NBFCs. In wonderful healthcare professional
underneath stringent manufacturing like prudential restrict and capital adequacy just like M&M
Finance, DBS Chula, Sundaram Finance Sri Ram transport Finance etc.

ELK Asia Pacific Journals – unique issue ISBN : 978-93-855370-1-1 future boom, if they get
regulatory treatment on for with the bank. In order that large NBFC might be converting and
making to be had credit score to credit.

L M Bhole in his e-book define the NBFCs carry out a varied range of feature and other numerous
economic offerings to person, company and institutional client. It additionally play effective role
in having access to sure depositor segment and clearing credit requirement of borrowers. It also
discussing the foremost economic marketplace in India. Along with related monetary device and
services i.e. name money, name mortgage, different quick term hobby rate instrument and the
recent development in cash marketplace.

Shashi k. Gupta, Nisha Gupta & Neeti Gupta in his book define money marketplace is an
opportunity for balancing the quick term surplus fund of the investor with the quick time period
requirement to borrowers. any other function of money marketplace is that they are liquid with
varying diploma. It also outline NBFCs play an vital position in monetary intermediaries because
they could take brief choice making expect more dangers and layout their product to the need of
customer.

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 RESEARCH METHODOLOGY

What is Research…?

Research is described as human pastime primarily based on intellectual utility inside the research
of be counted. The primary purpose for implemented studies is discovering, interpreting, and the
development of strategies and structures for the development of human knowledge on a wide kind
of clinical topics of our world and the universe.

The time period research is also used to describe a whole collection of information about a
particular difficulty.

Methodology

It's far the technique accompanied even as engaging in the look at on a selected task. Through this
system a systematic study is performed on the premise of which the premise of a document is
produced.

It's miles a written game plan for undertaking studies. Research methodology has many
dimensions. It consists of not best the research methods however also considers the good judgment
behind the strategies used within the context of the take a look at and explains why only a selected
technique or method has been used. It additionally helps to apprehend the assumptions underlying
diverse techniques and by way of which they could determine that sure strategies may be
applicable to positive issues and different will not. Therefore so that you can solve a studies
trouble, it's miles essential to layout a research methodology for the hassle as the some can also
vary from trouble to hassle. The method adopted for reading the objectives changed into surveying
the clients of NBFC in Navi Mumbai.

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NATURE

The technique adopted to attain the venture objective worried descriptive research technique. The
statistics required for pleasant the objective of look at changed into accrued from diverse primary
and secondary sources.

TYPE OF RESEARCH

This study is DESCRIPTIVE in nature. It helps in breaking vague problem into smaller and precise
problem and emphasizes on discovering of new ideas and insights.

RESEARCH DESIGN

Studies layout constitutes the blue print for the collection, size and evaluation of statistics. The
existing study seeks to discover the performance of NBFC based on customer satisfaction with
respect to Muthoot Finance. The studies layout is descriptive in nature. The research has been
carried out on the people who are in contact with Muthoot Finance. For the choice of the sample,
convenient sampling approach turned into followed and an try has been made to include all of the
age agencies and gender of every class.

RESEARCH INSTRUMENT

The tool used for collecting records turned into questionnaire. To get further perception in to the
research problem, interview regarding their shopping for practices too turned into made. This
changed into carried out to crosscheck the authenticity of the statistics provided. To supplement
the primary data and to facilitate the process of drawing inference, secondary records became
accrued from posted resources like magazines, journals, newspapers etc.

SAMPLING METHOD

SAMPLE DESIGN AND SIZE

In this studies task Descriptive research layout is used. Judgment and convenience sampling
technique might be used to get the statistics about overall performance of NBFC. This method is
used due to the fact we're interested in exploring gender, age, or profession disparities in phrases

49 | P a g e
of NBFC within the population. For engaging in this research, a established questionnaire is
prepared and pattern of 50 customers is taken from Muthoot Finance.

SAMPLING SIZE

It shows the numbers of human beings to be surveyed. Though massive samples deliver extra
dependable consequences than small samples but because of constraint of time and money, the
pattern size was limited to 50 respondents. The respondents belong to distinct profits institution
and career.

SAMPLING UNIT

It defines the goal population on the way to be sampled i.e. it solutions who is to be surveyed. in
this examine, the sampling unit is the people who are in contact with Muthoot Finance.

TOOLS AND TECHNIQUES OF ANALYSIS:

The data so collected will be analyzed through the application of statistical techniques, such as
pie charts.

DATA COLLECTION

Preserving in view the character of necessities of the look at to accumulate all the relevant facts
concerning the volume of awareness of the customers using NBFC as a source of finance direct
non-public interview approach with dependent questionnaire changed into followed for the
collection of primary facts. Secondary data has been accrued through the various internet web sites
via browsing on net and from the statistics to be had with the RBI.

SOURCE OF DATA

Following are the methods of sources of data:

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PRIMARY DATA:

Questionnaire become used to acquire number one information from respondents. The
questionnaire was established type and contained questions referring to different dimensions of
performance of Muthoot Finance amongst service elegance together with level of usage, factors
influencing the usage of Muthoot Finance services, blessings accruing to the users of NBFC
offerings, problems encountered. An strive was additionally made to elicit motives for its non-
utilization. The questions blanketed inside the questionnaire have been open-ended, and providing
multiple choices.

SECONDARY DATA:
• Articles on E-Banking taken from journals, magazines published from time to time.
• Through internet.

Limitation of Study

Every research is conducted under some constraints and this research is not an exception.
Limitations of this study are as follows :-

• As a studies is based on a sample, consequently, the findings may not monitor the authentic
statistics about the studies hassle, though an utmost care could be taken to choose a truly
representative pattern.

• There can be some bias within the responses of the respondents which can't be dominated out
absolutely.

• Sudden alternate inside the method of NBFC during the path of research can have an effect on
the results.

• The look at is performed inside the region of Navi Mumbai handiest.

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• The pattern length of only 50 became taken from the massive population for the purpose of study,
so there can be distinction among consequences of pattern from overall population.

• Humans have been reluctant to move in to info due to their busy schedules.

• Because of continuous exchange in environment, what's applicable these days can be irrelevant
the following day.

About Us

We are the biggest gold financing company in India in phrases of loan portfolio. (source: IMaCS
industry document (2010 replace). We provide personal and enterprise loans secured via gold
jwellary, or Gold Loans. we're a “Systemically vital Non-deposit taking NBFC” centered in the
southern Indian state of Kerala. Our promoters are Mr.M.G.George Muthoot , Mr.George Thomas
Muthoot , Mr. George Jacob Muthoot and Mr.George Alexander Muthoot. Our running history
has developed over a duration of 70 years in view that M George Muthoot (the father of our
Promoters) based a gold mortgage business in 1939 under the background of a trading enterprise
mounted by way of his father, Ninan Mathai Muthoot, in 1887. As of March 31, 2010 our
department community become the largest amongst gold loan NBFCs in India(source: IMaCS
enterprise record (2010 replace). Our department community as of August 31, 2010 become 1,921
branches

The Muthoot institution is an 123-12 months-antique business house based totally in India. It has
interestsin monetary services,

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Information Technology, Media, Healthcare, education, Power generation, Infrastructure,
Plantations, precious Metals and Hospitality. The Muthoot group operates in 21 states in India,
and has a purchaser base of over 25 million. it's far fully owned and controlled by using the
Muthoot circle of relatives.

The group takes its call from the Muthoot family based totally in Kerala. The agency became set
up by Muthoot Ninan Mathai in 1887 at Kozhencherry, a small city within the erstwhile state of
Travancore (Kerala). It changed into then later taken over by using his son M George Muthoot
who incorporated the Finance department of the institution which was until then more often than
not worried in wholesale of grains. The company is now controlled by means of the third and
fourth era of its family contributors.

Overview

We are the largest gold financing organisation in India in terms of loan portfolio. (source:
IMaCS enterprise report (2010 replace). We offer private and enterprise loans secured through
gold jewelry, or Gold Loans. we're a “Systemically important Non-deposit taking NBFC”
established inside the southern Indian nation of Kerala. Our promoters are Mr.M.G.George
Muthoot , Mr.George Thomas Muthoot , Mr. George Jacob Muthoot and Mr.George Alexander
Muthoot. Our working records has developed over a length of 70 years since M George
Muthoot (the daddy of our Promoters) based a gold mortgage commercial enterprise in 1939
under the background of a buying and selling enterprise mounted through his father, Ninan
Mathai Muthoot, in 1887. As of March 31, 2010 our branch community become the most
important among gold loan NBFCs in India(source: IMaCS enterprise document (2010
replace). Our branch network as of August 31, 2010 turned into 1,921 branches.

Board of Directors

M.G. George Muthoot, Chairman is a graduate in engineering from Manipal university, and
is a businessman through profession. he's the country wide executive Committee Member of
the Federation of Indian Chamber of commerce and enterprise (“FICCI”) and the cutting-edge

53 | P a g e
 Chairman of FICCI Kerala state Council. He became conferred the Mahatma Gandhi country
wide Award for social service for the 12 months 2001 by way of the Mahatma Gandhi national
foundation. he is an active member of various social corporations inclusive of the Delhi
Malayalee affiliation, Kerala club, Rotary club, country wide sports activities club and has been
chosen for numerous awards by using the Rotary global and the Y’s Mens worldwide for
community improvement and social service. He has been the member of the handling
Committee of Malankara Orthodox Syrian Church for over 31 years and is presently the lay
trustee of the Malankara Orthodox Syrian Church and a member of the working committee of
the Indian Orthodox Church. currently, he became conferred the HH Baselios Mathew I Award
by means of Catholicate of the Syrian Orthodox Church Mathews the first basis for the year
2008 for his offerings to the Church.

George Thomas Muthoot, whole Time Director is a businessman with the aid of career. He
has over 30 years of experience in dealing with companies operating inside the discipline of
financial services.

George Jacob Muthoot, entire Time Director has a diploma in civil engineering from Manipal
college and is a businessman by way of profession. He's a member of the Trivandrum control
association, the Confederation of real estate developers association of India (Trivandrum) and
the Trivandrum time table undertaking pressure. He is also a member of the Rotary
membership, Trivandrum (South), governing frame member of the Charitable and academic
Society of Trivandrum Orthodox Diocese, Ulloor, Trivandrum, Finance Committee Member,
Mar Diocese university of Pharmacy, Althara, Trivandrum and Mar Gregorious Orthodox
Christian Mercy Fellowship, Trivandrum.

George Alexander Muthoot, managing Director is a chartered accountant who certified with
a primary rank in Kerala and ranked twentieth common in India, in 1978. He has a bachelor
degree in commerce from Kerala university wherein he was a rank holder and gold medallist.
He become also offered the instances of India institution business Excellence Award in
customised economic offerings in March 2009. He served because the Chairman of the Kerala
Non banking Finance groups Welfare association from 2004 to 2007 and is currently its vp. He
is likewise the dealing with Committee Member of the device Leasing association, Chennai.
he's the founder member for The Indus entrepreneurs international, Kochi bankruptcy and is
now a member of the middle Committee of The Indus entrepreneurs worldwide Kochi chapter.

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 Justice k. John Mathew (retired), impartial Director is a graduate in regulation from the
authorities law university, Ernakulam and is a retired judge of the excessive courtroom of
Kerala. After retirement, he changed into appointed as a one guy commission to research into
the financial and administrative irregularities in the Aligarh Muslim college. He has served
because the Chairman of the Cochin stock alternate and changed into a SEBI nominee director
of the Cochin inventory alternate from 2002 to 2007. he's presently the President of the Peoples
Council for Social Justice, Kerala.

P. George Varghese, independent Director is a graduate in mechanical engineering from

Kerala college and holds a masters diploma in commercial enterprise management from Cochin
college of technology and era. He's the managing director of FCI OEN Connectors restrained
and FCI era offerings confined. He's a trustee of the IMA Blood financial institution, Kochi
and is a member of the governing council of DC college of control and technology. He has
served as the vice-president of the Kerala control affiliation from 2006 to 2007 and has been at
the coping with committee of the Indo American Chamber of trade from 1992 to 1999. He is
also a member of the CII-Kerala.

John okay Paul, impartial Director is a graduate in engineering from the local Engineering
college, Kozhikode and a businessman by means of career. he is a director of popular motors
confined, popular cars & offerings restrained, the primary Maruti dealer in Kerala and of
famous Mega vehicles (India) restrained., the dealer for TATA industrial motors. He's trustee
of the Kuttukaran Institute for HRD, that's a main organization presenting expert courses. He
turned into the president of the Kerala Chamber of trade and industry from 2005 to2006. He
changed into also the president of both the Kerala Hockey association from 2005 onwards and
the Ernakulam District Hockey affiliation from 2004 onwards.

INFORMATION TECHNOLOGY

Emsyne, the facts technology wing of the group develops products for the
service, education and healthcare industry. Emsyne offers on site and offshore
services, whether or not challenge-primarily based outsourcing / assignments, or
primarily based on time and materials. The core products of Emsyne are area –
instructional institutions management device Finex - modern Banking

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 Automation system.

SECURITIES

Muthoot Securities gives broker services in coins and derivatives segments at the countrywide
inventory trade and Bombay inventory exchange. It has a community of more than one hundred
branches. Muthoot Securities released its portfolio management offerings on 20 August 2009.

MEDIA

Chennai stay 104.eight is India's first talk radio FM station. The station could be specializing
in understanding centric and local content material and could be targeting the information and
amusement desires of Chennai's smart network.

HEALTHCARE

The institution operates numerous Diagnostic & experiment facilities during Kerala and a
couple of multi- strong point hospitals in Kozhencherry and Pathanamthitta.

HOTELS & HOSPITALITY

Muthoot resorts operates a 4 celebrity resort in Thekkady (Kerala) and additionally operates
12 houseboats inside the backwaters of Kerala under the emblem Muthoot River Escapes.
Kaapi membership is a chain of South Indian coffee retailers managed by using way of Muthoot
lodges. Muthoot accommodations is in the device of building a five famous man or woman
pricey motel inside the metropolis of Kochi and 5 famous person beach lodge in Mararikulam.

HOUSING & INFRA-STRUCTURE

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 The tasks of Muthoot developers are on the whole located in relevant and south Kerala,
Muthoot has a track record of greater than 30 completed projects consisting of industrial and
residential spaces.

OTHER DIVISION

Muthoot has hobbies in power era thru windmill farms in the nation of Tamil Nadu. The group
also manages a faculty in New Delhi and a pair of Nursing faculties in Kerala. in the 12 months
2008 the institution re-entered the plantation commercial enterprise, the institution has acquired
a thousand acres of land in Sawantvadi, Maharashtra as a pilot planting of rubber.

PHILANTROPHY

Muthoot M George Charity basis installation in reminiscence of the overdue M. George

Muthoot, the muse has been extending monetary useful resource for its employees as a part of
the body of workers Welfare measures. every branch of The Muthoot group is actively worried
in community development and Social Welfare. The Muthoot basis often grants scientific and
financial resource to deserving individuals through its welfare packages. Network support is a
corporate obligation. The Muthoot group maintains its role as a valued and responsible
corporate citizen by way of improving the first-class of existence within the groups where they
do business. it's far very vital for a company to support the network wherein it operates. The
Muthoot M. George Charitable foundation is approached via severa companies and people
soliciting for monetary and scientific help. Muthoot scientific centers at Kozhencherry and
Pathanamthitta are exquisite distinctiveness hospitals set up inside the rural regions of
Kozhencherry and Pathanamthitta. They may be each agencies set up in 1989.

ENVIRONMENT RESEARCH CENTRE

The Periyar foundation installation with the aid of Muthoot inns is based totally inside the
metropolis of Thekkady, near the Periyar country wide Park has undertaken numerous tasks for
the conservation of the countrywide park consisting of 'vasantha sena' and a research have a
look at in conjunction with the national Institute of increase research for the conservation of
'Nocturnal Flying Squirrels'.

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 FINANCE

Muthoot Finance a subsidiary of Muthoot institution become installed in 1939, and is often
worried in the monetary region of the united states. Muthoot Finance falls below the class of
Non Banking financial company (NBFCs) of the RBI hints.
The organization has more than 2038 branches spread throughout 23 states of the country and
is the most important gold loan company in India.. Muthoot Finance, according to the IMaCS
research & Analytics industry reviews [Gold Loans marketplace in India, 2009 (“IMaCS
enterprise record 2009”) and the 2010 replace to the IMaCS IndustryReport 2009 (“IMaCS
industry record (2010 replace)”)], is the largest Gold loan NBFC and has the most important
network of branches for a Gold mortgage NBFC in India.. Muthoot Finance is also the best
credit score rated Gold mortgage organisation in India, with a credit rating of AA- (CRISIL)
for its long term money owed and P1+ (CRISIL) & A1+ (ICRA) for its brief time period Debt
units.
‘Muthoot Gold energy’ is the way of life made from Muthoot Finance geared toward
mobilizing the household gold in India that's anticipated to be more than 15000 tonnes.
Muthoot Finance consistent with its enterprise website has "the largest gold mortgage portfolio
inside the country". Muthoot additionally offers various monetary services such as insurance
distribution, Wealth control, forex, money switch and car & Asset Finance. Muthoot Finance
was decided on as one of the top 10 Finance organizations to work for in India by using
Naukri.com[7] Muthoot Finance privately placed 4% of its paid up capital to private fairness
players - Barings India and Matrix partners India for Rs.1.57 billion, hence valuing the sooner
privately held employer at over $1 billion.

Rise of Gold Loan Markets.

• Wanning resistance amongst Indian middle and top middle class in the direction
of gold loans
• Upward thrust in rate of yellow metallic.
• Disappearance of social stigma attached to gold loans

. • Decrease hobby price- purer the gold, decrease the hobby rate
. • Simple technique.

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 • Loans dispersed for quantities ranging from 10,000 to 4,00,000 for NBFC and
25,000 to at least 1,00,000.

Process for Obtaining Gold Loan.

• Technique bank/NBFC for mortgage towards Gold

• Assessment of purity of Gold.
• Paperwork for loan
• Disbursal of mortgage
• On reimbursement of the mortgage, you get your gold returned from the
lender

Gold loan market- Spectacular Growth

Muthoot has visible 75% growth in wide variety of folks availing gold loans and
eighty one% increase in dispersals.

Muthoot Finance – Quick Stats.

• most in line with gram charges- 1600/gram for wellknown 99.9% purity of gold

. • zero% processing fee and no hidden value

. • charges of hobby beginning from 1% in step with month.

• eight distinctive schemes suiting all categories.

• best identification evidence required.

• Any person- wide variety of account required

. • interest most effective for real wide variety of days.

• 100% insured and gold kept in strong rooms simplest

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. • whenever redemption facility with out penalty.

• unique rewards points for M-electricity card holders.

OPTION NO. OF RESPONDENT

MALE 35
FEMALE 15
TOTAL 50

GENDER

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 OPTION NO. OF RESPONDENT
BELOW 20 5
20 – 30 10
30 – 40 25
ABOVE 50 10
Total 50

GENDER

30%
MALE
FEMALE
70%

Interpretation: The result shows that majority of respondents i.e. 70% are males and 35% are the
female who has given response .

AGE

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 AGE

BELOW 20
3% 12%
20 - 30

24% 30 - 40

61%
ABOVE 50

Interpretation: The result shows that majority of respondents i.e. 61% falls under the category
of 30-40 years and 24% falls under 20-30 it shows that NBFC is mainly famous among youngsters.

Q.1) Have you heard about NBFC ?

OPTION NO. OF RESPONDENT

YES 36
NO 14
TOTAL 50

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 OPTION NO. OF RESPONDENT
YES 15
NO 35
TOTAL 50

Have you heard about NBFC

28%
YES
NO

72%

Interpretation: According to the survey conducted 72% of the people are aware about NBFC in
Navi Mumbai where 28% of people are not aware and thus we can conclude that most of the
public are aware about the NBFC in Navi Mumbai.

Q.2) Do banks come under NBFC?

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 Do banks come under NBFC

30%
YES
NO
70%

Interpretation: According to the survey conducted 70% of the people think that NBFC do not
come under Bank where as 30% of the people think NBFC come under Bank. Thus we can
conclude that most of the people aware about NBFC.

Q.3) Have you ever taken a loan from NBFC?

OPTION NO. OF RESPONDENT

YES 35
NO 15
TOTAL 50

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 Have you ever taken a loan from NBFC

30%
YES
NO
70%

Interpretation: According to the survey conducted 70% of the people say YES whereas 30% of
the people said NO. Thus we can conclude that people are most interested in NBFC that the
banking sector.

Q.4) Is NBFC helpful in the development of Navi Mumbai ?

OPTION NO. OF RESPONDENT

YES 38
NO 12
TOTAL 50

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 Is NBFC helpful in the development of Navi
Mumbai

YES
24%
NO

76%

Interpretation: According to the survey conducted 76% people said YES whereas 24% of the
people said NO. Thus we can conclude that most of the people agree that the NBFC is helpful in
the development of Navi Mumbai.

Q.5) What kind of loan have you taken from NBFC ?

TYPE OF LOAN NO. OF RESPONDENT

PERSONAL LOAN 15
VEHICLE FINANCING 12
HOUSING LOAN 13
OTHERS FROM ABOVE 10
TOTAL 50

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 What kind of loan have you taken from NBFC

20% PERSONAL LOAN

30%
VEHICLE FINANCING

HOUSING LOAN
26%
OTHERS FROM ABOVE
24%

Interpretation: According to the survey conducted 30% of the people take personal loan,26%
of the people take housing loan 24% of the people take loan for vehicle financing and 20% of the
people take other type of loan. Thus we can conclude that people take different kinds of loan
from NBFC.

Q.6) Are you satisfied with the service offered by NBFC in Navi Mumbai?

OPTION NO. OF RESPONDENT

YES 36
NO 14
TOTAL 50

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 Are you satisfied with the service offered by
NBFC in Navi Mumbai?

YES
28%

NO

72%

Interpretation: According to the survey conducted 72% of the people are satisfied with the
services provide by NBFC in Navi Mumbai whereas 28% of the people are not satisfied with the
services of NBFC in Navi Mumbai. Thus we can conclude that NBFC is providing good services
in Navi Mumbai but it needs more improvements.

Q.7) Is there any difference between the Bank functions and NBFC?

OPTION NO. OF RESPONDENT

YES 38
NO 12
TOTAL 50

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 Is there any difference between the Bank
functions and NBFC?

24%
YES NO

76%

Interpretation: According the survey conducted 76% of the people said YES and 24% of the
people said NO. Thus we can conclude that most of the people are aware about the functions of
both NBFC and Banks and know the difference between them.

Q.8) From which of the below mentioned NBFC have you taken loan ?

NBFC NAME NO. OF RESPONDENT

MAHINDRA FINANCE 10
IDFC 12
MANAPURAM 8
MUTHOOT 20
TOTAL 50

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 From which of the below mentioned NBFC
have you taken loan

MUTHOOT
3%
28% MAHINDRA FINANCE
46% IDFC

MANAPURAM
23%

Interpretation: According to the survey conducted 46% of the people take loan from
MUTHOOT FINANCE, 23% of the people from MAHINDRA FINANCE,28% of the people
from IDFC and 3% from MANAPURAM. Thus we can conclude that most of the people take
loan from MUTHOOT FINANCE.

Q.9) In your opinion what is the reason for success of NBFC in Navi Mumbai?

REASON NO. OF RESPONDENT

LOW INTEREST RATE 22
BETTER CUSTOMER SERVICE 15
LESS PAPER FORMALITY 4
EASILY ACCESSIBLE 9
TOTAL 50

70 | P a g e
 ) In your opinion what is the reason for success
of NBFC in Navi Mumbai

LOW INTEREST RATE

18%
BETTER CUSTOMER SERVICES
8% 44%
LESS PAPER FORMALITY

30% EASILY ACCESSABLE

Interpretation: According to the survey conducted 44% of the people said low interest rate is
the success of NBFC in Navi Mumbai . whereas 30% are in favour of better customer service,
18% of the people said easily accessable and 8% said less paper formality.

Q.10) Do you know that every NBFC has to register itself

with the RBI?

OPTION NO. OF RESPONDENT

YES 45
NO 5
TOTAL 50

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 Do you know that every NBFC has to register
itself
with the RBI
YES

10%
NO

90%

Interpretation: According to the survey conducted 90% of the people said YES whereas 10%
of the people said NO. Thus we can conclude that most the people know that every NBFC has to
register itself with RBI.

Q.11) What is your opinion, will NBFC success in future?

OPTION NO. OF RESPONDENT

YES 35
NO 15
TOTAL 50

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 What is your opinion, will NBFC success in future

YES
30%

NO

70%

Interpretation: According to the survey conducted 70% of the people said YES whereas 30%
of the people said NO. Thus we can conclude that most of the people think that NBFC will
success in future.

Q.12) What will you say about the interest charged by NBFC?

OPTION NO. OF RESPONDENT

HIGHER THAN BANKS 12
LOWER THAN BANKS 28
EQUAL 10
TOTAL 50

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 What will you say about the interest charged by
NBFC

20% 24%
HIGHER THAN BANKS
LOWER THAN BANKS
EQUAL

56%

Interpretation: According to the survey conducted 56% of the people said lower than banks,
24% of the people said higher than banks and 20% of the people said equal. Thus most of the
people think that interest charged by NBFC is lower than Banks.

Q.13) From which source will you get a loan easily?

SOURCE NO. OF RESPONDENT

NBFC 32
BANKS 18
TOTAL 50

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 From which source will you get a loan easily

36%
NBFC
BANKS
64%

Interpretation: According to the survey 64% of the people said NBFC where as 36% of the
people said Banks. Thus we can conclude that most of the people think that they can get a loan
easily from NBFC.

Q.14) From which source will you get the information about different schemes of NBFC?

SOURCE NO. OF RESPONDENT

ADVERTISEMENT 25
CALL FROM COMPANY 5
POSTERS 10
PAMPHLETS 5
TOTAL 50

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 From which source will you get the information
about different schemes of NBFC

3% ADVERTISEMENT

24% CALL FROM COMPANY

POSTERS
PAMPHLETS
61%
12%

Interpretation: According to the survey 61% of the people said advertisement, 12% of the
people said call from company, 24% of the people said posters and 3% of the people said
pamphlets. Thus we can conclude that most of the people get information about NBFC through
advertisement.

15) Which of these NBFC is has less interest rate?

NBFC NO. OF RESPONDENT

MUDHOOT 22
RELIANCE 10
MAHINDRA FINANCE 12
OTHER FROM ABOVE 6
TOTAL 50

76 | P a g e
 ) Which of these NBFC is has less interest rate

MUTHOOT
12%
RELIANCE

44% MAHINDRA FINANCE

24%
OTHER FROM ABOVE

20%

Interpretation: According to the survey conducted 44% of the people said Muthoot finance,
20% of the people said Reliance, 24% of the people said Mahindra finance and 12% of the
people said from other NBFC. Thus we can conclude that most of the people think that Muthoot
charge less interest.

16) Are you aware about the procedure for loan in MUTHOOT ?

OPTION NO. OF RESPONDENT

YES 38
NO 12
TOTAL 50

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 Are you aware about the procedure for loan in
MUTHOOT

YES
24%
NO

76%

Interpretation: According to the survey conducted 76% of the people said YES whereas 24%
of the people said NO. Thus we can conclude that most of the people are aware about the
procedure for loan in Muthoot.

CONCLUSION

The performance primarily based on customer satisfaction of the business enterprise is higher.
Even though the NBFC’s are very vintage idea in India, but it has evolved with brought electricity
at some stage in 1990’s of twentieth Century. Many NBFC’s have failed in their agencies that
cause social unrest some of the public. The authorities of India has added regulatory norms to
adjust the NBFC’s on account that it's far in unorganized setup. Muthoot Finance is one in every
of the ones a hit organizations. Consequently, the researcher has made an attempt to investigate
the performance of Muthoot Finance. In widespread, Muthoot Finance has confirmed superb
overall performance, within the past Years. However the researcher has additionally determined
many quick falls, after a cautious analysis, researcher has supplied many precious suggestions to
the agency and which could be very useful to them.

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 FINDINGS OF THE STUDY

 From our study we find out that 36 male and 14 female are aware about NBFC in their
locality. The male are having more knowledge about the transactions and having more
knowledge about the services provided by the NBFC . Only the working ladies having
knowledge about the services or the female having the knowledge but not of the all the
services which are provided by the Muthoot Finance. So that’s why we considered only
those persons who are having knowledge about all services of NBFC which is provided by
the Muthoot Finance.

 Most of the respondents who lies above the age of 25 are using NBFC services as near
about 35 respondents are using these services to take loan.

 Most of the respondents i.e, 38 people said yes that NBFC is helpful in the development
of Navi Mumbai.

 Most of the people satisfied with the services provide by NBFC in Navi Mumbai.

 Most of the people prefer Muthoot Finance for loan.

 Most of the people said that low interest rate is the reason for success of NBFC.

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  Most of respondents are youngsters who are using services as near about 35 respondents
taken loan from NBFC.

 Most of the customers are satisfied with the services provide by Muthoot Finance.

 Among the overall percentage of the customers whose aware about the NBFC said they
prefer Muthoot Finance due to less interest from other company.

RECOMMENDATION AND SUGGESTIONS

We can see the time is changing and with the passage of time people are accepting NBFC as a
source of finance there is still a lot of perceptual blocking which hampers the growth it’s the
normal tendency of a human not to have changes work on the old track, that’s also one of the
reason for the slow acceptance of NBFC.

 NBFC’s has need to be more financially strong for success in future.

 The organization can introduce a brand new attractive scheme for the depositors.

 The organisation have to reduce the management and office costs to boom their net
income.

 The programme of the Muthoot Finance should be analyzed every time to time by some
experts, so that heavy changes in unwanted performance can be reduced.

 Muthoot Finance has to keep an eye on performance of the organisation and about the
schemes and strategies for customer satisfaction.

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Topic :- A research study on the performance of NBFC’s based on customer satisfaction
w.r.t Muthoot Finance in Navi Mumbai

Questionnaire
NAME - _________________________
AGE - ____________
GENDER - _________

1. Have you heard about NBFC ?

A. Yes B. No

2. Do banks come under NBFC ?

A. Yes B. No

3. Have you ever taken a loan from NBFC ?

A. Yes B. No

4. Is NBFC helpful in the development of Navi Mumbai ?

A. Yes B. No

5. What kind of loan have you taken from NBFC ?

a) Personal loan
b) Vehicle financing
c) Housing loan
d) Others from above

6. Are you satisfied with the service offered by NBFC in Navi Mumbai ?
A. Yes B. No

7. Is there any difference between the Bank functions and NBFC ?

A. Yes B. No

8. From which of the below mentioned NBFC have you taken loan ?
a) Mahindra finance
b) Idfc
c) Manapuram
d) Muthoot

9. In your opinion what is the reason for success of NBFC in Navi Mumbai ?
a) Low interest rate

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 b) Better customer service
c) Less paper formality
d) Easily accessible
10. Do you know that every NBFC has to register itself with the RBI ?
A. Yes B. No
11. What is your opinion, will NBFC success in future ?
A. Yes B. No

12. What will you say about the interest charged by NBFC ?
a) Higher than banks
b) Lower than banks
c) Equal
13. From which source will you get a loan easily?
a) NBFC
b) Banks
14. Do these NBFC’s provide different schemes to loyal customers?
A. Yes B. No

15. From which source will you get the information about different schemes of
NBFC ?
a) Advertising
b) Call from company
c) Posters
d) Pamphlets

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