Budget 2020 expectations: What NBFCs want, Umesh Revankar, MD and CEO of Shree Ram Transport reveals

The NBFC sector is eagerly waiting for some sops to be announced by Finance Minister Nirmala Sitharaman on budget (#BUDGET2020ZEE) day. So, what are the expectations of NBFC sector? Know it all from, MD and CEO of Shree Ram Transport, Umesh Revankar. He says there are several companies under NBFC sector, like infrastructure financing company, wholesale lending, vehicle financing companies, gold financing companies etc. He said that government and NBFCs should work together on priority sectors such as farmers, SME and entrepreneurs while lending to priority sectors. So, if they add NBFCs to banking for lending process then automatically it will reach to the banking targets. This will allow NBFCs to  also reach customers better. Currently, NBFCs are dependent on banks and play a complementary role. 

बजट में इनकम टैक्स दरों में कटौती होनी चाहिए। बैंक और NBFC मिलकर काम करेंगे तो नकदी की समस्या में सुधार आएगा: उमेश रेवणकर, MD & CEO, श्रीराम ट्रांसपोर्ट#CorporateRadar #Budget2020ZEE #ShriramTransport @SwatiKJain pic.twitter.com/ngQI5AnFot

— Zee Business (@ZeeBusiness) January 27, 2020

On special funds to be provided by the government,  Revankar, said that they have read about it but have no idea regarding any special funds. Earlier, there was talk of a refinancing window for NBFC, but he had no detail about any special funds. However, he added that if it is happening then he will welcome the initiative. Refinancing window is important for fall back arrangements for the last minute for NBFC. By having an emergency fund, It will increase the confidence of the NBFCs as lending process will be easy.

Revankar revealed that borrowing cost has reduced to 10-15 bps. It can reduce further because banks have liquidity in good amount. Once it  increases, the lending process will become faster along with transmission, So its expected that Cost of Fund will reduce more. 

On liquidity situation, Revankar said that when it comes to large NBFCs, the problem of liquidity has been resolved. For the company like larger NBFCs, there are less challenges but he has heard that smaller NBFCs, are still facing challenges. For now, liquidity situation is much better and it will improve over the next 2 months.

On government boosting consumption, he said that there should be a division between urban and rural. In urban areas, there's more focus on the challenges of buying apartments. People aren't buying homes because they aren't sure whether there will be any revival of real estate sector. There are challenges with ready flats availability. Consumers are postponing their purchase which has resulted in a decrease in consumption. There should be encouragement for completing incomplete projects and incentivise purchases from projects. In rural, areas there's infrastructure challenge, like portable water, sanitation, school, hospitals, which is leading to migration.