The following booklet titled “Finance Companies – Agenda For Urgent Action” authored by Dr. A.C. Shah commences by highlighting the important developments in the realm of the Non-Banking Financial Companies, namely, the Reserve Bank of India Act amendment which provides wide sweeping powers to the RBI, and the relaxation of access to credit facilities, which according to the author ‘marks an important stage in the growth process of NBFCs’. This comes in light of the industry’s growing role in the diversification of the overall financial sector. It further reveals a promising trend after the CRB scam which revealed the critical problems confronting the infant industry, namely the problem of liquidity. However, as investment and growth objectives are being redefined and prioritised, the industry aims to improve its position. The author further comments on how such a critical situation poses an opportunity for redemption by expelling the ‘bad eggs’ of the industry and adopting surveillance mechanisms for ensuring increased efficiency.
In conclusion, the author highlights that heightened specialisation of the industry in the coming years would allow for an accelerated growth of the financial market which offers competition and wider choices to investors, but this is contingent upon management capabilities and the observance of financial discipline.