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NBFCs are doing functions similar to banks. What is difference between banks & NBFCs ?

April 26, 2017Banks difference doing functions nbfcs similar

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NBFCs are doing functions similar to banks. What is difference between banks & NBFCs ?

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NBFCs are doing functions akin to that of banks; however there are a few differences: (i) an NBFC cannot accept demand deposits; (ii) an NBFC is not a part of the payment and settlement system and as such an NBFC cannot issue cheques drawn on itself; and (iii) deposit insurance facility of Deposit Insurance and Credit Guarantee Corporation is not available for NBFC depositors unlike in case of banks.