#nbfc-mfi

An NBFC‑MFI is a microfinance arm of an RBI‑registered non-banking financial company that specializes in small loans, savings, and insurance for individuals typically excluded from traditional banking.

Why NBFC‑MFI matters:

• Banks can’t reach everyone—these institutions bridge that gap. • They empower financially underserved communities, especially women entrepreneurs.

Key features:

Small-ticket loans (microcredit) and savings products

Regulated by RBI with interest rate caps (~26% p.a.)

Ideally licensed as NBFC‑MFIs to improve access to funding

Latest in India:

• MFIs increasingly transition into NBFCs to tap larger funding channels. • Example: Svatantra Microfin, established 2012, got NBFC‑MFI license in 2013 and now empowers rural women.

http://odishasamaya.com/news/india/sks-microfinance-gets-rs-100-cr-refinance-line-from-mudra/61625

Mumbai: SKS Microfinance today said Micro Units Development and Refinance Agency (Mudra) has sanctioned a refinance line of Rs 100 crore to the company at 10 per cent per annum to extend finance to micro entrepreneurs.

This is the first refinance limit sanctioned to the micro-finance firm by Mudra, a company release said here.

“At a rate of 10 per cent, this is lower than regular term loans from conventional lenders, and reinforces our assertion in the recent past that the non banking financial company micro finance institution (NBFC-MFI) structure does not preclude us from availing dedicated refinance lines at a lower rate of interest,” SKS Microfinance President Dilli Raj said.

The limit will help the micro-finance company bring down the cost of its interest-bearing liabilities, which stood at 11.9 per cent at the end of first quarter of FY16.

The company has seen an overall reduction of 3.8 per cent in cost of its interest-bearing liabilities since October 2014.

“We will pass on this benefit to our microfinance borrowers at an appropriate juncture,” Raj said.