1. LIC Housing Finance Limited

Overview: LIC HFL was established in 1989 and is one of India’s largest housing finance companies today. 

Its primary function is to provide long-term financing for individuals to buy or construct homes. As a Life Insurance Corporation subsidiary, LIC HFL is a credible and trustworthy source for loans and other financial needs.

LIC HFL offers individual, corporate, home improvement, and plot loans. They offer competitive interest rates that do not burden individuals, making home ownership affordable and accessible. LIC HFL also has flexible payment options and a comprehensive range of products that cater to the financial situations of different types of borrowers.

Achievements: Between 2021 and 2024, LIC Housing Finance Limited has made some significant achievements. The NBFC achieved a total profit of  ₹4,766 crore after taxes in FY2024. LIC HFL also disbursed a total of ₹14,300 crores in individual home loan disbursements.

2. Mahindra & Mahindra Financial Services Limited

Overview: Commonly known as Mahindra Finance, MMFSL is a critical player in the Indian NBFC market. Established on 1 January 1991, the major use case for MMFSL is vehicle financing, and they offer auto loans as well as two-wheeler loans.

Initially, the objective was to finance Mahindra vehicles, but the company then decided to expand financing to other sectors. Today, individuals can also avail of home loans and personal loans from MMFSL.

The company also assists with investments and offers a good range of mutual fund products.

Achievements: MMFL was honored as one of the BFSI brands in 2022. A huge achievement for any NBFC. The company also joined hands with Manulife Investment Management to further its mutual fund business.

3. Bajaj Finance Limited

Overview: Bajaj Finance Limited was started in March 1987. It is one of the leading NBFC companies in the Indian market, with a market capitalization of close to 4450 billion INR. It is a subsidiary of the Bajaj Group, one of the most trusted institutions nationally. 

Bajaj Finance offers several types of loans, both to individuals as well as businesses. Consumers can avail of personal, home, and vehicle loans while businesses can apply for medical equipment loans and unsecured business loans. Bajaj Finance also offers professional loans for doctors, chartered accountants, farmers, and lawyers.

Achievements: In 2021, BFL crossed a whopping ₹2 lakh crore in assets under management or AUM. For the uninitiated, AUM refers to the total value of assets a financial institution manages for its clients. BFL also has an EMI card network and was able to finance over 13.1 million purchases through this network in the financial year 2022.

4. L&T Finance

Overview: Established in 1993, L&T Finance is part of Larsen & Toubro, one of the largest engineering and construction conglomerates in India. It offers loans customized to specific consumer needs with quick approvals and sanctions. 

The NBFC offers five different types of financial products, such as urban finance for home, personal, and two-wheeler loans. There is also farmer financing, SME financing, and rural financing for small-scale businesses that may otherwise be rejected by banks and other financial institutions. L&T Finance offers insurance products as well.

Achievements: L&T Finance has reached a total customer base of 57.7 million customers by 2022. The platform has also managed to increase its e-commerce financing and has financed over 2.5 million transactions over the last few years.

5. Tata Capital Financial Services Limited

Overview: Tata Capital is primarily a housing finance company that offers various types of home loans to purchase or construct residential properties. Established in 2007 and incorporated in 2010, Tata Capital is a relatively new player in the NBFC market, but as a subsidiary of the Tata Group, it has already earned the trust of the larger population.

Aside from housing loans, Tata Capital also offers retail and business finance. The company is highly customer-centric and is popularly known for its transparent processes, customized financial products, and prompt customer service. 

Achievements: Tata Capital has always been quick to keep up with trends and its latest move to digitize processes has led to an addition of over 1.2 million customers to its customer base. The NBFC has also opened about 285 new branches across deeper markets of India.

6. Aditya Birla Finance Limited

Overview: Aditya Birla Finance Limited has a strong legacy in India’s financial market, owing to its being a subsidiary of the legendary Aditya Birla Group. It has a strong national presence and over 4.2 million customers in various financial segments. 

ABFL offers a diverse range of financial products, particularly for businesses in the SME and retail segments. The company also has personal finance products, including credit cards in partnership with banks like SBI and AU Small Finance Bank.

Businesses can avail of ABFL’s debt syndication and advisory services any time they want to raise debt capital or make strategic transactions during mergers and acquisitions.

Achievements: ABFL has over 323 branches in various locations across the country. One of its major achievements is crossing  ₹80,556 crore in total AUM by the end of 2023

7. Shriram Finance

Overview: Shriram Finance is currently the largest retail NBFC in India. The NBFC specializes in financing commercial vehicles and is a credible, trusted partner for truck owners, construction companies, and transporters. 

Shriram Finance offers loans to finance commercial goods vehicles, passenger vehicles, tractors, farm equipment, and construction equipment. Financing is also available for personal needs.

Achievements: Shriram Finance raised over $300 million via social bonds recently. The NBFC also has a great work culture, which is reflected in being certified as a ‘Great Place to Work’ in 2023.

8. Indiabulls Housing Finance Limited

Overview: Established in 2005, Indiabulls Housing Finance has been a popular choice for homebuyers and property owners in India. It offers home loans, personal loans, and top-up loans over existing ones. The NBFC even offers loans to non-residential Indians looking to buy or construct homes within India.

Achievements: In 2024, Indiabulls Housing Finance Limited took a huge step in accepting bids for dollar bonds. This gives the company access to global investors along with other advantages such as reduced interest rates on loans. Indiabulls has also acquired a profit after tax worth ₹319 crore in Q4 FY2024

9. Muthoot Finance

Overview: Known as the largest gold loan NBFC in India, Muthoot Finance has been a reliable source of financing for over eight decades. The company offers financial assistance to millions of people by leveraging gold as collateral.

Consumers can avail of flexible loan amounts depending on the value of gold at competitive interest rates. Muthoot Finance also offers several loan repayment options, such as bullet payments and installment schemes, tailored to borrower capacity.

Achievements: Today, Muthoot Finance has over 4,700 branches countrywide. Aside from this, the NBFC has a net capital of over ₹208.94 bn after accounting for all liabilities and deductions as of FY2023.

10. Piramal Capital & Housing Finance

Overview: Piramal Capital and Housing Finance offers several types of loans and financial assistance for individuals and small businesses.

They have customized solutions for corporates, real estate, and infrastructure projects. Piramal Finance even offers financing for special situations for businesses undergoing restructuring or facing liquidity issues.

The company’s retail finance products also cover home loans for purchasing, renovating, or constructing houses.

Achievements: Piramal Capital has over ₹50,000 crore in retail loans as of June 2024. It also has a large customer base of 4.1 million from just 1.7 million in 2022.

Emerging NBFCs to Watch

Aside from the larger players, India is also seeing the growth of several emerging players in the market. These emerging NBFCs leverage technology to bring many innovative products to the market. The proliferation of players will also increase competition, forcing established players to start fine-tuning their offerings and making them more affordable.

The biggest advantage is that as the competition grows, credit and financial assistance will be made available to even greater fractions of the population, reducing financial disparity.

Here are some emerging players to look out for:

1. Instamoney

Founded in 2018, InstaMoney is an instant loan application that eases loan approval and disbursal for applicants. The platform is famous for its hassle-free loan application process, which enables your application to get approved in less than 2 hours!

The platform is fully digital and requires very basic documentation from the applicant. This allows InstaMoney to cater to the financial needs of a broad segment of the population.

Achievements: InstaMoney has emerged as one of India’s top digital lending platforms, offering quick personal loans of up to ₹50,000. It is also among the NBFCs that have embraced a fully digital approach to its financial assistance services.

2. Axio (Formerly known as Capital Float)

Axio is a digital platform that offers quick lending services in India. It has a mobile app that offers instant personal loans anywhere between ₹5,000 to ₹50,000.

The NBFC also has partnerships with over 4000 online merchants to enable EMI and buy now, pay later options for customers. Axio’s mobile application is also equipped with features to track your expenses, across multiple financial sources.

3. Lendingkart

Another recently established player, Lendingkart, is RBI-registered and offers loans to small and medium businesses. They have four different loan options – business loans, MSME loans, working capital, and a separate option for business loans for women.

Lendingkart’s loan application process is completely online and you can get your loan approved and disbursed in less than a day.

Driving Financial Inclusion and Economic Growth with the Help of NBFCs

Securing reliable and trustworthy financing at affordable and accessible rates continues to be a monumental challenge for many segments of the Indian population.

The entry of NBFCs, however, has mitigated this challenge to a large extent and has successfully improved financial inclusivity for previously underserved factions of the population. As new players continue to enter the market, NBFCs will play a bigger role in providing diverse financial services to millions of individuals and businesses across India.

This will contribute to increased economic growth, innovation, and development that can take India’s financial ecosystem to new heights.

If you’re looking for a quick loan for your personal or business needs, InstaMoney is the best way to go. Simply download the Instamoney app and get started with your loan application process.

Frequently Asked Questions (FAQs)

What is an NBFC, and how does it differ from banks?

An NBFC or non-banking financial company is an institution that offers financial products to individuals and businesses that cannot otherwise avail of financial assistance from traditional banks.

NBFCs are different from banks because they do not have a banking license and cannot accept deposits from the public. They have much more relaxed regulations than banks, and most of them offer very specialized services, such as housing loans or vehicle loans.

How are NBFCs regulated in India?

NBFCs in India are directly under the governance of the Reserve Bank of India, or RBI. The RBI Act of India, 1934, sets specific guidelines and regulations, including certain registration eligibility criteria, prudential norms, risk management practices, and asset classification guidelines.

What are the eligibility criteria for obtaining a loan from an NBFC?

While there are standardized criteria for availing loans from an NBFC, they also vary on factors like the type of loan, procedures, and policies of the financial institution issuing the loan. However, the most common eligibility criteria are:
-Applicant must be 18 or above
-Regular source of income
-Clean credit history
-Repayment capacity
-Valuable collateral such as land or gold