New Delhi, Nov 24 (NationPress) The assets under management (AUM) of non-banking financial companies (NBFCs) in India are anticipated to experience a consistent growth rate of 18-19% this fiscal year and FY27, reaching over Rs 50 lakh crore by March 2027, according to a report released on Monday.

The analysis from ratings firm Crisil Ratings indicated that this growth will be fueled by enhanced consumption patterns and favorable policy initiatives such as GST rationalization, alongside manageable inflation levels.

These elements are expected to bolster demand for retail credit, the agency noted. Conversely, variations in risk management and access to funding will influence growth projections differently among various entities and asset categories.

“The vehicle finance and housing loan sectors will experience steady growth amidst increasing competition. However, in light of heightened customer leverage, NBFCs will proceed with a cautious approach to risk, particularly in the micro, small, and medium enterprises (MSME) and unsecured loan sectors,” stated Krishnan Sitaraman, Chief Ratings Officer at Crisil Ratings.

The firm forecasts segment-specific growth, predicting that vehicle finance (representing roughly 22% of NBFC AUM) will grow by 16-17%, while home loans (also about 22%) will expand by 12-13% over the next two fiscal years.

Alongside the positive impacts from GST, the growing preference for premium vehicles and the increasing focus on used-vehicle financing will continue to support AUM growth, despite strong competition from banks in the new vehicle segment.

While long-term demand for housing remains robust, growth may be hindered by tough competition from public sector banks, the report highlighted.

Personal loans (approximately 11% of AUM) are projected to see an increase to 22-25% growth post-regulatory adjustments, whereas growth in unsecured MSME business loans (around 6%) may decelerate to 13-14% due to rising delinquencies, the report concluded.