NBFC – The full form of NBFC is Non Banking Financial Company. These are registered under companies act of 1956, which may largely replaced by the Companies Act 2013 of India. NBFCs are different from banks and fo not have banking license. They are mot allowed to take deposits from public and allowed to provide banking services regarding loans and advances, acquisition of shares, chit businesses, stock bonds hire-purchase insurance business, and retirement planning business. They are allowed to be engaged in the business of

1. Loads and Advances
2. Insurance business
3. Chit business
4. Stock bonds hire-purchase
5. Retirement planning
6. Acquisition of shares

Types of NBFC’s – There are different types of NBFCs are as given below

1. Investment Company (IC) – It is financial institution doing business of acquisition of securities.
2. Asset Finance Company (AFC) – It principal or main business is financing of automobiles, cranes, automobiles, tractors, generator sets, lathe machines, and many more.
3. Infrastructure Finance Company (IFC) – It is a company which
   • It displays at least or about 75 percent  of its total assets in infrastructure loans.
   • It has a CRAR of 15 percent.
   • It had minimum net owned funds of Rs 300 crores.
   • It has a minimum credit rating of A
4. NBFC Factors – It has principal or main business of factoring. Factoring is a finance transition in which business sells its accounts to third party called a factor at a discount.
5. Gold Loan NBFCs – It is a company, which offers loans against gold.
6. Infrastructure Debit Fund – NBFC ( IDF – NBFC) – It is a company to facilitate flow of long term debt into Infrastructure projects.
7. Loan Company – It is a financial institution, which provides loans and advances.
8. Residuary Non Banking Companies (RNBCs) – It had principal business of receiving deposits under any scheme and not being investment, Asset financing and loan company.