However, as you have noticed over the years, we continued to remain
steadfast in our focus towards promoting financial country. As a result of our concerted
efforts, we were successfully able to end the seemingly slow year with a record-breaking
performance in the final quarter, a testament to our undeterred focus irrespective of
external developments.
Before I delve into the details of our performance, it is imperative
that we talk about the economic environment in which we operate. In the global context,
India has indeed been a silver lining; despite challenges posed by inflation and supply
chain disruptions, the Indian economy displayed immense resilience, supported by the
Government?s proactive measures including infrastructure investments, promoting
private investment, and pursuing self-sufficiency
India retained its position as the fifth-largest economy in the world
and I truly believe that it will continue on this growth trajectory over the foreseeable
future as well.
The financial sector is crucial and indispensable for any nation state
that aims to achieve robust economic growth. That applies to India too. Banks and
Non-Banking Financial Companies (NBFCs) in India are very well positioned to play that
role. With robust loan and deposit growth and low levels of bad loans as of FY2024, banks
and NBFCs can invest in creating new products, delivery channels and outreach to serve the
increasing financial services needs of India.
ishe financialcrucial sector and
Tindispensable for any nation state that aims to achieve robust
economic growth. That applies to India too. Banks and Non-Banking Financial Companies
(NBFCs) in India are very well positioned to play that role. With robust loan and deposit
growth and low levels of bad loans as of FY2024, banks and NBFCs can invest in creating
new products, delivery channels and outreach to serve the increasing financial services
needs of India. Now, let me discuss NBFCs. NBFCs have become key players in India?s
financial sector, supplementing banks by filling the credit gap under-served segments and
Micro, Small, and Medium Enterprises (MSMEs). With a deep understanding of local markets
and a strong drive for innovation, NBFCs have advanced credit dissemination, offering
customised products and services at a reasonable cost. NBFC sector ofAUM NBFCs is
estimated at US$ 326 billion as of FY2023, reflecting their increasing role in meeting the
needs of growing India. This performance shows the sector?s strength and its vital
contribution to India?s economic growth.
The NBFC market has also been marked with positivity over the last few
years. According to a report by the Reserve Bank of India, non-banking financial companies
(NBFCs) have posted the highest credit growth of
17.3% in the last five years, while net interest margins for lenders
increased by 30 basis points due to higher yields.
The profitability has recorded significant improvement due to record
disbursals and improved asset quality. In addition to this, NBFCs also reported lower
gross non-performing assets, and credit costs continue to trend downwards.