NBFC Software: One Stop Solution for Lending Businesses

Non-banking financial companies play a crucial role in the financial sector of the Indian economy. They have inherent advantages of a deeper outreach to the public, flexibility in operations, better domain knowledge and feel of the local area. They are better placed to serve the masses in the un-banked areas, particularly in the retail and MSME sector. The total credit of the NBFC sector has already crossed the threshold of Rs. 28 lac crores. The credit intensity of NBFCs, measured by NBFC credit as a ratio of GDP has been rising consistently and stood at 13.7 in 2021 as compared to 8.6 in 2013 — retail lending forms around 30% of total lending, followed by the MSME sector.

Considering the importance of NBFCs as a purveyor of credit, the Reserve Bank of India has strengthened the regulations over a period of time to ensure a robust credit mechanism for this sector. The NBFC software for Lending Businesses, therefore, assumes great importance in the current scenario.

Lending Operations and the Role of NBFC Software

A comprehensive, well-structured credit mechanism is essential for ensuring a healthy and growing loan portfolio of NBFCs. This requires robust risk management and a streamlined mechanism for operations while ensuring system integrity.

The digitalization of processes and use of NBFC software thus becomes essential. Such software can provide a one-stop solution for the Lending Business of NBFCs. The software can take care of all aspects of the lending operations while ensuring, speed/efficiency, transparency and effective risk management.

Key features of NBFC software

NBFC software should provide an end-to-end solution and should be scalable and sustainable. It should be installable on the premises of the NBFC and also be enabled for API integration. The software needs to provide straight-through processing with a flexible delivery mechanism.

The NBFC software should be able to provide data aggregation across a wide range of unstructured data to cull out the requisite information. It should be able to handle big data and make use of AI-based algorithms to help in decision-making on credit issues. The NBFC software should also provide financial inclusion and co-lending features. The integration of the entire data collection and its usage needs to be robust with inbuilt security features; the backend features need to be healthy with adequate audit trails.

Needless to say, the NBFC software has to be an ‘All IN ONE’ product to provide a win-win situation for all the parties and stakeholders.

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