Eligible NBFCs explore the right capital for their next stage of growth.

NBFC FUND RAISING

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Our Mission

Recognizing the distinct funding requirements of Non-Banking Financial Companies (NBFCs), we provide strategic counsel and access to a comprehensive suite of financial instruments.

Our Vision

Equip your organization with the necessary liquidity to facilitate operational expansion, optimize loan disbursement processes, and foster enduring growth within the evolving Indian financial landscape.

Access to capital is fundamental to scaling the lending book

Capital for Lending. Funding for Growth.

Whether the requirement is for growth capital, debt funding, bank finance, institutional funding, structured finance, refinancing, capital augmentation or strategic equity, the right capital structure can make a significant difference to the institution’s ability to grow sustainably.

XYZ Arrow helps NBFCs evaluate and explore potentially suitable capital-raising and financing solutions across banks, financial institutions, institutional investors, AIFs, family offices, private credit providers and strategic investors, subject to investor/lender appetite and applicable regulatory requirements.

OUR NBFC FUND RAISING SOLUTIONS

Financial institutions continue to serve as a primary funding channel, offering term loans, Commercial Papers (CPs), and Non-Convertible Debentures (NCDs). Recent regulatory adjustments by the Reserve Bank of India (RBI) have led to a more selective lending environment, heavily influenced by credit ratings.

  • Advantages: Favorable and adaptable terms are available for Non-Banking Financial Companies (NBFCs) with strong credit ratings.
  • Disadvantages: Increased regulatory compliance requirements and elevated risk weight considerations.

Non-Convertible Debentures (NCDs) are well-suited for long-term capital needs, contingent upon the Non-Banking Financial Company (NBFC) maintaining a robust credit rating.

Commercial Papers (CPs) offer an effective solution for short-term liquidity requirements, specifically for institutions with the highest credit ratings.

  • Advantages include a reduced cost of capital.
  • Disadvantages encompass market volatility and reliance on credit ratings.
  • Strategically sell or securitize loan assets to bolster liquidity and mitigate credit risk by transferring it to investors. This approach is especially advantageous for Non-Banking Financial Companies (NBFCs) with constrained credit profiles.
  • Advantages: Improves liquidity and risk transfer.
  • Disadvantages: Involves structural complexities and market volatility.

High-rated NBFCs frequently leverage international markets to secure funding at more favorable interest rates. These transactions are subject to hedging protocols and regulatory compliance as mandated by the Reserve Bank of India.

  • Advantages include access to global capital. 
  • Disadvantages encompass currency risk and associated compliance expenses.

Equity financing is a viable option for startups and growth-stage non-banking financial companies (NBFCs) seeking capital without incurring debt obligations.

  • Advantages include the absence of interest payments and enhancement of net worth.
  • Disadvantages encompass ownership dilution and increased investor oversight.
  • Government Initiatives: Strategic subsidies and grants are allocated to key sectors, including MSMEs and rural finance.
  • Co-lending Partnerships: This approach leverages bank capital in conjunction with the operational efficiency of NBFCs.
  • Peer-to-Peer Lending Platforms: These online platforms facilitate direct funding by connecting borrowers with retail investors.
  • Foreign Direct Investment: Significant capital infusions are secured from international investors, adhering to the guidelines established by the Reserve Bank of India.

EXECUTION FRAMEWORK

HOW WE APPROACH AN NBFC FUND-RAISING MANDATE

We understand:

AUM | Product | Geography | Borrower Segment | Ticket Size | Portfolio

We examine available:

Financials | Borrowings | Capital | Liquidity | Profitability | Cash Flows

Where relevant:

AUM | GNPA | NNPA | Collection Efficiency | Yield | Vintage | Concentration

We assess available information on:

Assets vs Liabilities | Tenor | Maturity | Liquidity | Refinancing Requirements

We define:

Amount | Purpose | Tenor | Security | Instrument | Target Cost

We identify potentially relevant:

Banks | Institutions | AIFs | Debt Funds | Family Offices | PE | Strategic Investors

We develop an appropriate funding approach based on the transaction profile.

We facilitate discussions with potentially relevant capital providers.

The relevant investor/lender conducts independent financial, legal, regulatory, commercial and credit due diligence.

The transaction proceeds toward documentation, approval and disbursement/investment subject to applicable conditions.

WHO WE SERVE

INFORMATION GENERALLY REQUIRED

Corporate Information

  • Certificate of Incorporation
  • Corporate structure
  • Shareholding pattern
  • Promoter profile
  • Management profile
  • Regulatory registration/details

Financial Information

  • Audited financial statements
  • Latest provisional financials
  • Financial projections
  • Net worth
  • Capital adequacy information
  • Existing debt

Portfolio Information

  • AUM
  • Product-wise portfolio
  • Geography
  • Borrower profile
  • Ticket size
  • Portfolio vintage
  • GNPA / NNPA
  • Collection efficiency
  • Write-offs
  • Portfolio concentration

Funding Information

  • Existing lenders
  • Sanctioned facilities
  • Outstanding borrowings
  • Interest rates
  • Maturity profile
  • Security
  • Repayment schedule

Transaction Information

  • Funding requirement
  • Proposed instrument
  • Purpose
  • Preferred tenor
  • Security available
  • Target funding cost
  • Proposed repayment structure
Features of Our Services

Why Choose Us?

we have a network of best as well as cost effective  Solution across Eco-system.

XYZ Arrow states that its broader network includes consultants, investment bankers, fund and family houses, banks/NBFCs, AIFs, ARCs, private lenders and fintechs, along with engagement with angels, VCs and fund houses globally.

Our team can assist with investor presentations, business profiles, project reports, financial models, valuation, cap-table preparation and exit-strategy considerations.

We help businesses evaluate whether equity, debt or a combination of capital sources may be appropriate for their funding objectives.

Our team brings experience across corporate funding, investment banking, financial structuring and business advisory.

From initial assessment and funding strategy to coordination with potential financing institutions, we support the process through the relevant stages.

Frequently Asked Questions

Potentially, although a new or early-stage NBFC may face different investor/lender requirements compared with an established institution. Capital providers may consider promoter strength, regulatory status, business model, governance, projected portfolio and funding strategy.

There is no universal minimum. The appropriate funding amount depends on the NBFC’s capital requirements, lending strategy, existing liabilities, AUM, growth plans and investor/lender appetite.

Potentially. Financing structures can vary from secured borrowing to structures based primarily on the institution’s financial strength, cash flows and portfolio. The applicable security depends on the lender and transaction.

Yes, eligible NBFCs may explore funding specifically intended to support lending-book expansion, subject to capital requirements, lender criteria, portfolio quality and other applicable conditions.

NBFC refinancing involves raising new financing to refinance or replace existing liabilities, potentially to improve tenor, cost, liquidity or liability structure, subject to lender assessment.

Eligible NBFCs may explore debt securities such as NCDs subject to applicable regulatory, securities-law, issuance and investor requirements.

he timeline varies substantially based on the funding size, financial profile, documentation, due diligence, investor/lender appetite, regulatory requirements and transaction complexity.

  • No. Funding is subject to project due diligence, eligibility, documentation, lender or investor appetite, commercial terms and applicable legal and regulatory requirements.

LET'S DISCUSS YOUR FUNDING REQUIREMENT

Investment is subject to investor interest, due diligence, valuation, transaction structure, regulatory requirements and applicable approvals. XYZ Arrow does not guarantee investment, valuation or transaction closure.

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