Category : Economy & Banking
 To give a fillip to digital lending, Small Industries Development Bank of India (SIDBI)has put together a pilot scheme to extend financial assistance of up to Rs10 crore to new-age fintech non-banking finance companies (NBFCs) engaged in financing small businesses and other income-generating activities. SIDBI has set the exposure cap for lending to a single new-age fintech NBFC at 30% of NOF of the new-age fintech NBFC, subject to maximum cap of Rs10 crore. As per the scheme, new-age fintech NBFCs should hold in trust the underlying securities/ receivables on behalf of SIDBI. |
What are Fintech NBFCs?Fintech NBFCs are digital loan companies. They leverage information technology to provide fast and convenient access to funding. To be eligible for funding assistance, Reserve Bank of India-registered new-age fintech NBFCs have to meet prescribed parameters, including minimum capital risk-weighted assets ratio of 15%; non-performing assets less than or equal to 4%; minimum net-owned fund (NOF) of Rs20 crore and minimum asset size of Rs50 crore; and at least two audited annual reports, positive net worth and leverage ratio within 5:1. |
Source- The Hindu Business Line |
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