NBFCs: Diverse Approaches, Single Purpose

At Indian Merchants Chambers' Banking & Finance Conference, several CEOs of NBFCs spoke on the topic 'Digital Lending - Bridging the credit gap & creating a financial landscape that includes everyone'. Edited excerpts:

K .V. Srinivasan: MSMEs face problem of more than just money. Their challenge is how do they maintain financial discipline. Their traditional attitude is to stay out of the taxman's eye. That is changing, especially with the newer generation taking over the business reins. There is a generational change in attitude. This has stepped forward with the prevalence of GST. Progressive people are understanding the skills of going from starting a business to scaling a business, such as raising capital. Raising equity calls for governance, which is becoming increasingly important. Gone are the days where NBFCs offered templated products. Now the products are customized for industry, customers, geography, needs, etc. Capital subsidy scheme was a reasonable success, but awareness was very low. In north east, 90% of amount was subsidized, but how many people know about this? Capabilities of banks and NBFCs are focused on lending, not on creating awareness. In my previous organization, I had done 300 seminars over 3 years for SMEs. That sort of awareness creation is so critical.