RBI asks shadow banks to give information on supply-chain financing

NBFCs may have to rework credit service typically used by small businesses

The Reserve Bank of India (RBI) has sought details on supply-chain finance offers of non-banking financial companies (NBFCs).

 

Industry sources said the RBI’s Department of Super­vision (DoS) has told a few leading shadow banks that they may have to rework these offers.

 

Supply-chain finance is extended by NBFCs as term loans typically ranging between 30 days and 180 days with each tranche a distinct term loan in itself within the overall credit limit determined by an NBFC of a borrower. These facilities are mostly taken by micro, small, and medium enterprises (MSMEs) with seasonal or cyclical businesses from NBFCs for