Non-banking financial company (NBFC) to be operational by end this year

July 16, 2018

Harsimrat Kaur Badal, Union minister for Food Processing Industries stated that request for proposal (RFP) for the non-banking financial company (NBFC) exclusively catering to the financial needs of the food processing sector would be floated this month and the NBFC would possibly be operational by the end of this year. NBFC may be renamed Agro-Processing Financial Institution and would have investment worth close to Rs. 2,000 crore and the ministry will put seed money of about 20 per cent.

The RFP is supposed to be floated this month and there is a lot of interest from the private sector not only nationally but also globally (to invest in the entity). There is a huge growth potential in the sector. However access to bank funds has been difficult because the banks fail to understand the risk assessment for the sector.

The growth potential is huge but banks have refused to finance the way we would have wanted them to as they do not fully understand the risk assessment,” she said.

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