Expert Insights Into The Impact Of RBI Regulations
Adapting To Change: Expert Insights Into The Impact Of RBI Regulations On NBFCs And Fintech Ecosystem
As we delve into the current financial year, it's paramount to dissect the nuanced interplay between RBI directives and the adaptability of NBFCs and fintech firms
Adapting To Change
The RBI's regulations have a big impact on the dynamic financial services industry as they continue to shape the growth of the fintech ecosystem and NBFCs. With each regulatory amendment, a ripple effect permeates through the industry, impacting operations, innovation, and ultimately, the consumer experience. As we delve into the current financial year, it's paramount to dissect the nuanced interplay between RBI directives and the adaptability of NBFCs and fintech firms.While this clarity was generally welcomed by NBFC and the fintech industry, certain quarters of the industry felt that the 5 percent cap on the DLG needed a relook, as it could adversely affect the confidence of lenders in taking exposure in certain segments of credit, particularly in unsecured credit and thereby affect business volumes in such credit segment. Additionally, the requirement of maintenance of the DLG in the form of fixed deposits, cash deposits, or bank guarantees necessitated a relook by lending institutions into several existing DLG arrangements, which had been negotiated as corporate guarantees. It also placed demands on the loan service providing fintechs to raise tangible resources to be able to provide DLGs.