The Most Valuable Non-Banking Financial Companies March2022 - Insights Success

Industry Sagacity Changing Scenario of NBFC's post-pandemic

VOL 03 ISSUE 02 2022

Exploring capabilities The Significance of NBFC's in India

The Most

Partha Sengupta, Chief Executive Officer

Valuable

Non-Banking

Financial

Companies

S V Creditline

Limited

Enabling Convenience in Non-Banking Financial Space

Editor’s Note COMPREHENDING THE FUNDAMENTALS IN THE NBFC NICHE

N

BFCs are playing a phenomenal role in the Indian economy by providing excellent funding sources. Over the last few years, the NBFC has made incredible progress.

NBFCs focus on industries like infrastructure, micro, small, and medium-sized businesses, ensuring reliable financial stability. However, Do NBFCs ensure financial reliability?

Borrowers frequently use NBFCs instead of banks because they are more efficient at meeting financial needs. As a result, NBFCs emerged as a viable alternative to traditional banking. Even though the year 2019 brought several challenges for the sector, it was clear that there is an urgent need to focus on the positives. They are considering the future of NBFCs in India, concerning—the goal of reaching a $5 trillion economy by 2024.

Abhishek Joshi Deputy Editor

abhishek.joshi@insightssuccess.com

Newly formed NBFCs are employing cutting-edge technology, which will lead to a brighter future for NBFCs. Artificial intelligence and machine learning technologies have prepared lenders to evaluate customer perceptions and maintain alternative credit scoring models.

NBFCs are adopting a technology-driven business model that reduces reliance on manual tasks—towards a brighter future.

NBFCs have contributed considerably to the economy with great scope shortly. They outsmart the banks and have a great potential to reach the borrowers, which is sure to change the banking value chain.

With the emergence of small finance banks, many of them would encourage NBFCs, which will pave the way to create an extensive financial base for its

customers. The government extends its support to NBFCs in building a substantial base for lending activities.

Focused on such fundamentals, Insights Success brings you its edition featuring ‘The Most Valuable Non-Banking Financial Companies,' embracing the journey of these companies with the profound expertise that is enabling innovations in the NBFC niche.

Have a good time reading!

C O V E R S T O R Y

S V Creditline 08 Limited Enabling Convenience in Non-Banking Financial Space

Unalloyed Asset Management

KM GATECHA & CO LLP Dynamic Veterans of Financial Services

20

28

C O N T E N T

Beyond Books N Compliance

Article 16

Industry Sagacity Changing Scenario of NBFC's post-pandemic

24 The Significance of

Exploring capabilities NBFC's in India

Editor-in-Chief Pooja M. Bansal Deputy Editor Abhishek Joshi Managing Editor Gaurav PR Wankhade

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The Most

Valuable

Non-Banking

Financial Companies Company Name

Management

Brief

BBNC

Nithin Shetty, Founder and CEO

BBNC is a technology-Driven Entity, offering its services virtually across India to support its clients at every stage of their business lifecycle to ensure the business remains compliant and growing.

KM GATECHA & CO LLP

Milap Pravinbhai Gatecha, Designated Partner

K M GATECHA & CO LLP is the highest form of organization i.e Limited Liability Partnership which is permitted to form for a chartered accountancy firm.

Navachetana Microfin Services Pvt.Ltd

Nagendra Mali, Chairman and MD

Navachetana aims to reach economically backward women and their families for effective poverty alleviation by providing microfinance and bring about ‘financial inclusion’ of all the unprivileged.

Repco Micro Finance Limited

Yashpal Gupta, MD

RMFL was established with an aim to assist the poor women for their upliftment, promote entrepreneurship and providing micro credit/ finance in different loan cycles at reasonable rates of interest.

SV Creditline Limited

Partha Sengupta, CEO

SV Creditline provides easy access to credit as well as a range of financial services to under-served households. The range of products & services includes offering small credit for income-generating activities linked with credit life coverage.

C O V E R

S V Creditline Limited

Enabling Convenience in Non-Banking Financial Space

T O R Y

“

“

S

SVCL's value proposition has always been customer-centric with simplified and efficient processes.

The Most Valuable Non-Banking Financial Companies!

NBFCs is an essential pillar in the growth of a country's economy by boosting the transportation, job creation, wealth building, bank lending in rural areas, and offering help to financially disadvantaged people.

The number of NBFCs are increasing immensely in the last few years since venture capital companies, retail, and industrial companies have entered the lending business apart from banks known as NBFCs have contributed significantly to the success of numerous businesses.

NBFCs not only helping in the lending business but also strengthen the space of wealth management, insurance, and payments. One such NBFC is SVCL (S V Creditline Limited), that is promoting businesses and entrepreneurs with relevant financial tools and enables them to reengineer and uplift their economic status eventually.

S V Creditline Limited (SVCL) is one of the India's largest and most respected Non-Banking Financial Company.

Established in 2010, SVCL's vision is to uplift "entrepreneurial poor" through giving them easy access to credit which is otherwise scarcely available.

Visionary Goal The objective of SVCL is to promote entrepreneurs with relevant financial tools enabling them to re-engineer and uplift their financial status eventually.

“

SVCL is moving towards end-to-end digitising with complete paperless operation wherein even documents will be secured digitally.

“

B

y catering to the different financial needs of the banks' excluded clients, NBFCs (Non Banking Financial Companies) plays a vital role in encouraging inclusive growth in the Country. In addition, NBFCs frequently take the lead in delivering new financial services to Micro, Small, and Medium Enterprises (MSMEs) which are best suited to their needs.

Since its foundation, SVCL has diversified rapidly, opened branches across Uttar Pradesh, Madhya Pradesh, and Rajasthan, and has further expanded to areas of Bihar, Gujarat, Haryana, Chhattisgarh, Uttarakhand, Punjab, and Jharkhand.

SVCL's value proposition has always been customer-centric with simplified and efficient processes, transparent pricing structures, and diversified option plans. The Company's setups are conveniently located and easily accessible for customers who are reached out by its trained field staff.

The on-ground team is essential for this to drive the objectives at the grassroots level and provide much-needed comfort to customers.

Taking Onus as CEO of SV Creditline Mr. Partha Sengupta, an inspiring and visionary leader, serves as Chief Executive Officer of S V Creditline

Limited. He holds more than 23 years of diverse C-Suite experience across e-commerce, Banking, Retail Assets, and Microfinance Industries at the PAN-India level.

He joined SVCL amid the COVID-19 pandemic and the impact on this segment of the customer was vast and visible. The priority was to give immediate relief and support, so that they don't fall apart in their personal and credit needs.

After normalcy of this situation, the focus was on innovative product range to comprehend the needs of the customer into financial inclusion.

A customer-centric approach through call center skilling classes improved the ability to earn more make financially self-sufficient business , sustain expansion by which AUM has moved from Rs. 426. Cr in June 2021 to Rs. 570 Cr. in January 2022 and expects to reach Rs. 850.Cr by March 2022.

The Company recently started its operation in the parts of Gujarat, Rajasthan and Madhya Pradesh as new expansion and has opened 38 new branches from June 2021.

Aprat from existing Business Correspondent Partners, the Company has also welcomed few Business Correspondent Partners (BC Partners) like IDBI Bank, DCB Bank, Jana Small Finance Bank Limited & Yes Bank Ltd.

The company is moving towards end-to-end digitising with a completely paperless operation wherein all documents will be secured digitally. With digitalization, we expect better transparency, faster reporting, compliance orientation, and convenience to reach the customer.

Vanquishing the Hardships The resurgence of COVID-19 pandemic in India which has significantly impacted the economy specifically NBFCs, RBI announced certain reguatory measures to mitigate the burden of debt servicing and to ensure the continuity of viable businesses which includes Moratorium for all existing NBFCs' clients. Pursuant to such meansure, the Management of the Company decided to grant moratorium to all Business Correspondent clients.

Consequent to which there was an incremental change in the existing EMIs, whereby the client continued to pay EMIs as per the schedule which triggered the increase in Areares .

SVCL management decided to convince/educate clients for the timely payments availing Moratorium, there were some delays in such collections, but gradually recovery rate has been reached 115% to 120%.

The economy was impacted by COVID-19 wave in March 2020 and then in the second wave in April 2021. Due to the lockdown in many parts of the Country, MFI sector was again severely affected as there was low mobility of its collections field force. Further, JLG discipline was impacted March 2020 till August 2020.

Despite lockdown and movement restrictions, all the branches of SVCL were open giving healthy collection and confidence among the customers. The Company also

distributed free medicine to clients in multiple locations.

Many initiatives were taken by the Company such as telemedical support and medical camps to provide immediate help and support to villages and customers. Further SVCL's core management team implemented COVID Policy under which a free medical kit was sent to the employee to help them with the essential medical assistance. If any employee evaluated COVID positive, then financial assistance of Rs. 25,000 given upfront along with paid leaves. · · ·

SVCL arranged a COVID Vaccination camp for its employees and their relatives Special drive for Branch cleanliness and hygiene Free tele-consultation with the doctor is available for employees and their families

“

SVCL aims to promote entrepreneurs with relevant financial tools enabling them to re-engineer and uplift their financial status in the long run.

“

Revolutionizing the Non-Banking Financial Space With the rapid change in technology, the sector must adopt Artificial Intelligence and Machine Learning, which will help predict data behaviours without human intervention.

Using algorithms, detecting transactional frauds would be much easier by analysing millions of data points that tend to go unnoticed by humans.

Analysing customer behaviour would be much more convenient, and the creditworthiness of that respective customer can be easily determined. This will also help in understanding business dynamics today and are ahead of the curve to better respond to the ever-changing business scenarios.

One of the notable example of AI-led software is Chatbots which is extremely convenient to serve customer queries quickly and drastically cut down the lead time.

•

System: These processes should not be personally driven but should be system driven. Thus, there should not be people dependence but should be system dependence

•

Internal control: Financial space being highly vulnerable and susceptible to risks and fraud a strong internal control right from customer identification to closure is essential

•

Financial space is highly vulnerable and susceptible to risks and fraud. This is further aggravated by changing micro and macro-economic dynamics of the country.

But with all its risks associated with this sector, it has given a huge opportunity for budding entrepreneurs and enthusiasts aspiring to venture into the Non-Banking Financial Space. This is mainly because of the huge unbanked population of the country.

Triple bottom line: People need to move from double bottom line P&L to triple bottom line P&L where the third bottom line should be the human resource capital.

Institutions need to invest in firstly, identifying and attracting human resources with the right skill sets, secondly training them, and thirdly retaining them

•

Delicate touch and Technology: Nothing can replace delicate touch, but these entrepreneurs should use the technology without diluting the delicate touch. And last but not the least, use of Artificial Intelligence.

Mr. Partha Sengupta's recommendations to these are:

The Journey Ahead

•

SVCL has now formalized a new strategy of achieving an AUM of Rs. 850 Crores by March 2022 by pushing the managed portfolio. With new BC partnership arrangements,

Precious Words

Process: With the robust process, implementing these processes in letter and spirit will be key for making the new enterprise a profitable and scalable model.

“

SVCL aims to expand from the current portfolio, in place of this, the company has managed to get some new sanctions, this will fuel the growth of the company in the upcoming years.

“

the ratio of the managed portfolio as per strategy from 50% of the AUM to a maximum of 70% of the AUM of the company.

Based on the continued financial support of the promoter shareholders and other funding and expansion plans, the management is confident that the company will achieve the initial levels soon.

During the period, the company has also managed to get some new sanctions from banks/financial institutions which will fuel the growth of the company in the upcoming years.

Changing

Scenario of

NBFC's

post-pandemic

I

ndia is on its way to becoming one of the world’s top three economies in the future. It will grow to a ten trillion-dollar economy from its current three trilliondollar economy. Though currently in its de-growth due to COVID, the Indian growth story is healthy and unbroken.

Two pillars will support the country’s economic growth story. The first pillar is a vibrant and strong debt market ecosystem. And the second pillar is a robust capital market system supported by high savings to GDP percentage ratio.

Amongst the many drivers, the financial services sector’s secular growth is fuelled by the thriving digital ecosystem.

NBFCs that have transformed significantly in the last decade play a key role in economic and social inclusion.

They now play a crucial role as financial intermediaries and promote financial inclusion to the so-far excluded section of society.

Over the decade, the sector saw a rapid expansion. A few NBFCs became so large that they could match their size to private sector banks.

The segment also saw the advent of technology leveraged by many non-traditional players. There is a new willingness to adopt innovative tech-based business models in postpandemic times quickly.

In terms of their diversity of functioning and degree of reach, NBFCs have evolved tremendously.

Overcoming the COVID Pandemic During the initial period of the coronavirus pandemic, the industry was temporarily affected by liquidity and demand squeeze. There were severe demand contractions for four months, from April to July 2020.

They provide last-mile financial services access to the lessbanked or unbanked population by meeting their diversified financial needs.

Though India’s lockdowns were the longest globally, timely intervention by regulators aided the industry in effectively tackling the pandemic.

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Industry Sagacity

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The government’s timely intervention and moratorium, along with multiple liquidity tranches, have all pulled the industry out of the liquidity crunch.

One significant change brought by the pandemic into the industry in general and the NBFC sector, in particular, is the acceleration to technological adoption.

NBFC, especially its subset of microfinance institutions (MFIs), are transaction-intensive industries. The real challenge faced by this sector is not technological adoption but how and where to adopt the technology.

In the post-pandemic world, removing prejudice, bias, partiality, and discretionary elements from the decisionmaking process is the most critical element for NBFCs on their march into the future.

There is an urgent need that the industry must quickly learn to ensure that the entire operational process is end-to-end digitised.

The successful futuristic models are bound to be digitised platform based. Thus, every NBFC which has not been digitised yet must fully digitise itself before it is too late.

Similarly, the industry must resist its lure of chasing quick progress at the cost of quality. Here industry leadership is going to be tested.

NBFCs must streamline their human resource, functional and technological bandwidth into their core business model.

That way, they can keep progressing smoothly in the transaction-intensive aspects of financial services like MFIs. The Post-Pandemic Futuristic NBFCs The futuristic NBFC ecosystem is going to be digital, regulatory, transaction-sensitive, and scrutiny-based.

Thus, it is essential for all the industry members to pivot their core functioning with critically proper fundamentals on a daily basis.

These fundamentals include correct transactions, accurate records, easily accessible customer touchpoints, and a robust and responsive system.

These fundamentals revolve around key differentiators like the customer-centric approach, employee-first principle, compassionate business model, and systematic-robust functioning.

-Customer-centric approach During the time of pandemic severity, many NBFCs reached out to their customers, creating awareness about COVID and providing relief measures to their customers. It helped them in earning customer respect at every touchpoint.

In the post-pandemic world, NBFCs must continue this social equity and see that all members achieve it.

-Employee-first principle Employees are the pillars of any business, especially a business like NBFC. However, digitise any system, without human touch, no online transaction is going to happen.

Thus, NBFC must build their employee trust to build customer trust.

-Compassionate business model NBFCs must build their business with compassion and create an empathetic mindset. Transparency in all of their transactions will help them progress a long way.

-Systematic-robust functioning A robust system helps build a bridge of trust between employees and customers. Whatever be the service like from approaching, onboarding, assessing creditworthiness to disbursements, repayment, and overall customer engagement, an NBFC must follow the best possible, moral, and ethical practices.

The Way Forward For NBFCs, building capability through alliances is the best way forward. It is a continuous process, and technological collaboration tops the list. It could be followed by equity and debt partnership.

Exploring such beneficial partnerships through networking and expansion is the key to the long-term survival of this sector. Instead of chasing demands, NBFCs must establish the proper operational framework to prosper in the changed post-pandemic scenarios.

The fiscal support and expanding market provide enough opportunities to everybody in the industry. But to tap the unlimited market potential, a continuous tech up-gradation and process streamlining is going to be the crucial factors.

The future is full of promises. And NBFCs that will prioritise quality instead of growth, process-orientation instead of chasing demand, and continuous innovation rather than running after profits will be the ultimate market leaders.

- Gaurav Wankhade

18 | March 2022 | www.insightssuccess.in

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BEYOND BOOKS N COMPLIANCE Unalloyed Asset Management

A

s a business grows and expands, so does its needs.

Once your business grows beyond a certain point, you will need support in managing all aspects, including monetary management.

However, an even better mindset would be that even when your business is still small, you should not skimp on having all the essential help for your success, such as accountants.

Although hiring an accounting firm to be a part of your team may seem like an added expense for you, it is one that you should consider as a necessary part of your operations.

Especially when it comes to some of the most important aspects of running a business, such as your finances, this is

not one for you to skimp on.

Remember that one mistake can spell the difference between financial failure and success. An accounting firm has years of experience in updating a business’s books and only uses the best tools for the job.

Regardless of the size and nature of your business, accounting firms will know which type of automated accounts payable system to use to keep your business’s finances up to date. The support of an accounting firm can provide excellent benefits for your business beyond just the finances.

20 | March 2022 | www.insightssuccess.in

The Most Valuable Non-Banking Financial Companies

This is where Beyond Books N Compliance (BBNC) excels in the industry as a leading one-stop solution provider for all your needs related to Accounting, Compliance, and Legal Services. The company aims to offer quality services to its clients under one umbrella where they do not have to deal with many professionals simultaneously.

In an interview with Insights Success, Mr Nithin Shetty, Founder and CEO, sheds light on the journey of BBNC, highlighting its USPs, vision, and stronghold in NonBanking Financial niche.

Nithin, please tell us about Beyond Books N Compliance.

Beyond Books, N Compliance (BBNC) is a one-stop solution provider for all your Accounting, Compliances and Legal needs. We aim to build a robust and sustainable cloud accounting platform to meet businesses' financial and bookkeeping requirements and the compliance requirements of statutory bodies.

We provide reliable, efficient, experienced accounting support to your business and ensure sound financial advice based on regular maintenance of your financial data.

In this Digital era, we offer our services virtually across PAN India. However, we have two branches, Bengaluru, and Hyderabad, across the country, and we are planning for an expansion.

Tell us more about your company and the key aspects of its stronghold in the Non-Banking Financial Space.

We are a team of experienced professionals, including Chartered Accountants, Cost Accountants, Company Secretaries and Lawyers, dedicated towards helping entrepreneurs and companies with their Accounting, Taxation, Compliance and Legal requirements.

To build a robust virtual fintech platform synonym to Resorting and Compliance requirements.

BBNC Mission of beyond Books N compliance.

Our MISSION

BBNC started with a simple mission: doing business in India should be easy and seamless. To accomplish our mission, we have built a team of Professional Chartered Accountants, Cost Accountants, Company Secretaries and Lawyers.

They are dedicated to help entrepreneurs and companies with their Accounting, Taxation, Compliance, and Legal requirements.

We are a technology-Driven Entity, offering our services virtually across India. We aim to support our clients at every stage of their business lifecycle to ensure the business remains compliant and growing.

BBNC started with a simple mission that doing business in India should be made

As a team of qualified professionals, we want to help clients’ businesses to grow by ensuring the accounting and compliance functions of businesses are strictly adhering to local laws and regulations in which they operate.

Our OBJECTIVE We are committed to building long-term relationships with our clients to achieve real success.

What kind of services do you provide to your clients?

Business Set-Up Services: We are into helping entrepreneurs set up their business as per the governing laws and regulations, and they will need a separate legal entity to operate the business.

BBNC assists in creating such legal entity by incorporating: • Private Limited Company • Public Limited Company • Limited Liability Partnership • One Person company • Subsidiaries to foreign entities • Partnership firm and Non-Profit Organizations, etc

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Approvals and Licenses: Once the incorporation process is completed, we will help in getting the required registrations according to various Applicable statutes such as: • Shops and Establishment License • GST Registration • Import Export Code • MSME/Udyam Registration • Digital Signature Certificate (DSC) • Food License (FSSAI) • Provident Fund • Employee State Insurance (ESI) • Professional Tax Accounts and Finance: We Tailor-made end to end accounting solutions suiting clients’ business environment and business; we help in designing, implementing, maintaining controlled accounting framework, policies, and procedures.

• • •

Internal Stocks and Accounts receivables audits Physical audits – Direct and Indirect taxes Forensic audit, Investigation and Due Diligence

Contracts and Legal Services: • Co-founders agreement • Vendor agreement • Employment contract • Non-disclosure and non-compete agreement • Service level agreement • Privacy policies, etc Company Secretarial Services: • Change in Reg Address of Company • Share Transfer • Annual filings of Company/LLP • Conversion of one entity type to another • FLA, FC-GPR and FC- TRS • Closure of a company/LLP etc • Appointment/Resignation of Directors • Private Placement of shares etc

Our list of services includes: End to End Accounting (AP, AR, GL) • Implementing financial processes (P2P, R2R, O2C) • Vendor- Customer and Bank reconciliations • All Statutory required registers- FAR, Accounting, Ageing report etc • Forecasting, budgeting, and variance analysis • MIS Statements/Reports • Payroll Management • Working Capital and Cash flow management • Book Closure and Preparation of Financial Statements (Monthly/Quarterly and Annual) • IND AS and IFRS – Compliant Financials • Intercompany reconciliations and consolidated financials considering applicable reporting framework Taxation: • Tax planning and advisory- Ex: Drafting business contracts in complying with fiscal laws • GST Advisory and Compliances – Determine TOS, POS and ITC etc • Scrutiny’s, Appeals, ITAT – Direct and Indirect taxes • International Taxation – Transfer Pricing, Equalisation Levy, DTAA and NRI Taxation

Intellectual Property Rights and Protection Services: • Trademark Registration • Copyright Registration • Patent registration • Patent Search • Brand Name etc.

Our clientele in sectors in which we operate: • Software and Information Technology • Manufacturing • E-Commerce • Real Estate and Construction • Consumer Durable • Consultancy Support • FMCG • Food Processing • Retailing and Distribution • Travel, Tourism and Leisure • Trading • Foreign companies having subsidiaries in India • NRI Taxation and Compliance.

Audit and Assurance Services: • Financial Audits - Statutory Audit/ External Audit/

22 | March 2022 | www.insightssuccess.in

BEYOND BOOKS N COMPLIANCE

The

Significance of NBFCs in India N

o country’s growth is based on exclusivity. The growth, development, and prosperity of any nation must be inclusive. Financial inclusion is one of the “most important subsets of inclusivity.

Generally, banks play a crucial role of keeping the economy’s financial engine vibrant by catering to almost all the financial needs of the majority of the population.

But as per RBI, by the end of March 2021, India’s Financial Inclusion Index was 53.9 or approximately fifty-four per cent.

Another report by Statista states that India’s unbanked population stood at twenty per cent by 2021. That means out of 1.4 billion people, twenty-eight million people do not have access to the banks.

This is where non-banking financial corporations/companies (NBFCs) play the pivotal role of financial assistance to such bank excluded populations and micro, small, and medium enterprises (MSMEs).

NBFCs’ significance is further felt as they participate in the

24 | March 2022 | www.insightssuccess.in

Exploring capabilities

25 | March 2022 | www.insightssuccess.in

economic development by filliping industries and sectors alike.

It also accelerates bank credit of rural segments, generates employment, creates wealth by supporting financially weaker parts of the society.

The Equalizers While operating under the extensive regulatory framework, NBFCs have evolved as the go-to option for marginalised and underprivileged sections of society to meet their many credit needs. Serving these vulnerable sections with a doorto-door delivery model and keeping their operational cost low gives NBFCs an edge over the banking institutions.

As the government launched schemes like Pradhan Mantri Jan-Dhan Yojana, increasing the number of bank account holders significantly, NBFCs are substantially leveraging this opportunity to fuel growth and entrepreneurship.

During times of crisis, like the pandemic, socio-economic distress and financial duress, NBFCs are emerging as the key player in mitigating and managing the spread of risks.

It is boosting their recognition as the complimentary service providers to banks.

NBFCs have become integral for the rural economy, including microfinance, Agri and non-agricultural loans and credit facilities. Women are the most uplifted sector by the micro-financial support they receive because of the NBFC aided self-help groups.

Further, NBFCs play a significant role in offering credit to the small borrowers at the local level and the unorganised sector.

Their most significant activity of hire purchase finance has blurred the lines between banks and NBFCs. And they facilitate long term investment and financing, which is a challenge for the banking sector. Thus, NBFCs growth widens the range of products and services available for people/businesses in the underrepresented rural-urban areas.

It helps in lessening the rural-urban divide and decreasing financial inequality.

Engines of Growth As per the latest RBI report, as of Jan 2021, there were nine thousand four hundred twenty-five NBFCs registered with the Reserve Bank of India. They were listed in the categories like asset finance companies, infrastructure finance companies (IFCs), loan companies, infrastructure debt fund (IDF) and microfinance institutions (MFIs), and systematically important core investment companies (CIC, ND, SI).

There are other structural catalysts like an extensive, vibrantly entrepreneurial and start-up ecosystem that has created the NBFC demand in the first place.

And GOIs policy initiatives like Pradhan Mantri Yojana (PMY) and National Rural Financial (NRF) plan augment the industry further.

Also, the growth in lending, credit, and vehicle financing is driving the diverse financial needs of the Indian economy. A result of these growth drivers can be seen in the increasing public funds and bigger balance sheets of NBFCs. Before the pandemic, that is, in 2019-20, MFI registered 80% growth, while the housing loan sector recorded 37% growth. Similarly, development for IDFs and MFIs loans and advances grew by 46% and 8%, respectively, during the same timeframe.

And as per the RBIs article, NBFCs’ stellar performance during 2021 amidst the disruptions caused by coronavirus’s first and second wave shows the resilience of these financial entities.

The double-digit growth further signifies their necessity in a developing country like India. The article is written by Nandini Jayakumar, KM Neelima, and Gopal Prasad, from the Department of Economic and Policy Research under the guidance of Ashok Sahoo, Adviser.

It further points out that this double-digit growth under an adverse macroeconomic environment reflects the flexibility of the NBFCs in quick adoption of technology, strong fundamentals, and substantial policy support.

This way, they absorbed the pandemic impact due to the lockdowns, severe restrictions, COVID norms of social distancing, and economic activities coming to a halt.

Exploring the Tomorrow NBFCs are revolutionising the economy by providing constant double-digit growth despite the setbacks.

They provide financial access to the unbanked society. This inclusion is higher than the banking sector, with more people choosing NBFCs over banks.

They offer cheaper credit at lower costs enhancing the financial sector by increasing liquidity in the markets and diversifying the risks. Thus, they bring efficiency and promotes financial stability.

In the post-pandemic world, NBFCs significance will increase even more due to the tremendous liquidity crunch the world economy in general and the Indian economy, in particular, is facing. And strengthening NBFCs is the only way India could hope to see a better future.

NBFCs have always been an integral part of the MSME’s growth story. And India’s rural, small scale and unbanked sectoral growth is further driving the demand of NBFCs and supply to the MSMEs developmental saga.

26 | March 2022 | www.insightssuccess.in

- Gaurav Wankhade

K M Gatecha & Co LLP Dynamic Veterans of Financial Services

E

xpert financial advice from a trusted professional, with a prominent level of ethics, in tax, audit, and other statutory requirements is crucial for every business. Thus, Chartered Accountants (CAs), who works on the principles of determination, discipline, and dedication, are always trusted by people in business.

KM Gatecha & Co LLP is such a dependable name. It is an accountancy company which provides the best Chartered Accountants services. The firm is growing with the balance of excellent professionals trained under dynamic veterans.

The company aims to keep professional ethics at the highest level and client satisfaction through effective and efficient services. Thus, they are a brand to reckon with.

Run by prominent leaders like Milap Pravinbhai Gatecha, Designated Partner, and headquartered at Ahmedabad, Gujarat, KMG & Co is renowned for its team of experienced CAs and dedicated support to provide both personal and professional financial services.

In an interview with Insights Success for its latest edition of ‘The Most Valuable Non-Banking Financial Companies,’ Mr Gatecha details his unique take on the NBFC industry and his company’s role in providing trusted services year after year in this sector.

Below are the excerpts from the interview.

Please tell us about your journey at KMG & Co. LLP. My journey started as a manager (scale- II) at the Karur Vysya Bank. I am also a certified forensic auditor. I have experience with professionally managed corporates as a consultant in accounting and auditing.

My exposures include: • Worked at the Karur Vysya Bank Ltd as a Manager (Scale-II), at a regional office level, as a credit processing office for one year.

• Also performed statutory audits of two nationalized banks and one cooperative bank.

• Also managed concurrent audit of large branches of nationalized banks.

• In-charged with stock audit, credit audit and revenue audit of various banks.

• Provides statutory audit services to numerous private limited companies, limited companies, and other corporations under the Companies Act, 2013.

• Performs indirect and direct tax audit/returns, company related services (incorporation/preparation of search report, MOA, AOA/filings of returns), accounting, Tax assessment, scrutiny and appeals of corporates, firms, proprietorship, and other entities.

• Also manages the matters pertaining to annual filings with MCA of private companies under the ‘Companies

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The Most Valuable Non-Banking Financial Companies

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Act, 2013.’

Also conducted due diligence of large corporate for a project relating to slump sales.

Tell us more about KMG & Co, its vision, and the key aspects of its stronghold in the Non-Banking Financial Space.

We are prominent chartered accountants in India and designated partners in KM GATECHA & CO. We offer services in Ahmedabad and other major cities in India.

Our services include accounts outsourcing, auditing, company formation in India, business taxation, corporate compliance, starting a business in India, registration of foreign companies, transfer pricing, GST registration, bookkeeping services, MCA services, MCA filing, TAX audit services, project finance service, tax due diligence, taxation of expatriates etc.

Our firm continuously strives to be the premier accounting and consultancy firm that provides excellent service to our clients and excellent quality of life for our associates.

From a business leadership perspective, what is your opinion on the impact of the COVID-19 pandemic on the Non-Banking Financial Industry?

The COVID-19 shock hit on the non-banking financial industry. The pandemic highlights the importance of effective operational risk management. As financial services continue to recover from the crisis and strengthen risk management, the focus remains on providing excellent and effective services.

The pandemic also accelerated the take-up of digital financial services as financial institutions and reduced physical interactions. The pandemic highlights the importance of effective operational risk management arrangements before a shock hits.

What efforts did you take during the pandemic to sustain operations and ensure the safety of your team at the same time?

Being the best Chartered Accountants in Ahmedabad, we always try to provide the best services to our clients during COVID 19 pandemic; we provide necessary service from home and online.

Our firm continuously strives to be the Premier Accounting and Consultancy firm

We believe in providing extremely reliable and qualitative services within the time specified. Besides this, quick, costeffective, and efficient service is the priority of our firm.

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We are prominent Chartered Accountants in India

What is your opinion on the necessity for Non-Banking Financial companies to align their offerings with technologies like AI and ML? Non-banking financial companies (NBFCs) have played a key role in India’s march towards financial inclusion. They have emerged as a reliable alternative to mainstream banks in India. They have played a significant role in providing solutions to the MSME (Micro Small and Medium Enterprises) segment.

As an established industry leader, what would be your advice to the budding entrepreneurs and enthusiasts aspiring to venture into the Non-Banking Financial Space?

Of the hundreds of thousands of business ventures that entrepreneurs launch every year, many never get off the ground of those who keep aspiring to venture into the nonbanking financial space.

Many entrepreneurs say they are launching their businesses to achieve their goals and independence and control their destiny, but those goals are too vague. If they stop and think about it, most entrepreneurs can identify more specific goals.

How do you envision strengthening KMG & CO’s stronghold in 2022 and beyond?

The world today is changing a lot faster than it used to. Our company and our team have envisioned growing and includes experienced CAs and dedicated support to provide personal and professional financial services to our clients, enabling clients’ satisfaction through effective and efficient services.

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