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Bank and NBFC Finance
Bank & NBFC both refer to financial services that provide funding, but they differ in their structure, regulations, and types of financial products they offer.
- Bank Finance
- Banks are financial institutions that are licensed to accept deposits from the public and provide loans. They are regulated by national regulators, such as central banks or financial authorities.
- Types of Bank Finance:
- Loans: Banks provide various types of loans, including personal loans, home loans, car loans, and business loans.
- Credit Lines: Banks offer overdraft facilities or revolving lines of credit to businesses or individuals.
- Trade Finance: Banks also provide financing for international trade, including letters of credit and trade credit.
- Working Capital Finance: Short-term loans to businesses to manage day-to-day operations.
- NBFC Finance
- NBFCs are financial institutions that provide similar services to banks but are not allowed to take deposits from the public. They focus on providing loans, asset financing, and investment products.
- Types of NBFC Finance:
- Loans and Advances: NBFCs provide personal loans, business loans, and loans against property (LAP).
- Leasing and Hire Purchase: NBFCs are also involved in leasing equipment or vehicles and offering hire-purchase schemes.
- Asset Management: Some NBFCs manage mutual funds or offer wealth management services.
- Microfinance: NBFC-MFIs focus on providing small loans to low-income individuals or groups, especially in rural areas.
