MUMBAI, 09 NOVEMBER, 2020 (GPN): This is a welcome move by the RBI to allow non-banking finance companies to jointly lend with banks. This will be a big step towards improving credit flow to the underserved segments of customers and pave the way for NBFCs to improve the credit flow with customized products as per need of these segments . This will also help address credit demand as the economy emerges from the impact of COVID.

The decision is based on feedback received from stakeholders that sought to improve the flow of credit to the unserved and underserved sectors of the economy. Such moves along with the others recently announced by the apex bank like tweaking the risk-weight norms for retail housing loans will go a long way towards aiding economic recovery through employment generation as well.

Religare Finvest Ltd (RFL) Chairperson cum Managing Director Dr. Rashmi Saluja said,“RFL will benefit from the Co-Lending Model (CLM) suggested by RBI in medium to long term and is looking at the development with positivity for company and NBFC sector. We will explore the new opportunity once we have completed our debt restructuring process. We have already put in place an improved corporate governance mechanism involving risk management, approval structures and compliance. Along with implementation of the debt restructuring process and Capital structure improvement, RFL aims to apply to RBI for exit from CAP at the earliest.”

This move is also a big positive for the housing finance business. Our housing finance company under RFL will actively look to align with banks to step up lending to home loan seekers, particularly in the affordable housing segment, Dr. Saluja added.

RFL CEO Pankaj Sharma said the company has a proven track record of its ability to assess credit worthiness of SME borrowers, which is crucial for succeeding in this segment. A robust credit assessment processes positions RFL extremely well to capitalize on this opportunity in medium to long term.

“We are working very closely with the regulators and are confident to start fresh business from the next financial year,” he said. ENDS