The Centre for Advanced Financial Research and Learning (CAFRAL), set up by the RBI, has raised concern over the rise in the bank financing for non-banking finance companies.
Following the market correction prompted by the IL&FS default and a brief pause due to the COVID-19 pandemic, bank financing for NBFCs has begun to rise again, it said. “This raises concerns about systemic contagion and underscores the need for tighter preventive measures to mitigate potential systemic fallout,” CAFRAL, a not-for-profit organisation, said in its India Finance Report.
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