Customer experience is a key enabler for customer loyalty and growth. This aspect is no different when it comes to the banking and financial services industry. The rise of FinTech and digital lenders compelled traditional banks and non-banking lenders to include customer experience as a key priority. As per a McKinsey research, leaders in the banking industry delivered 55% higher total…
As per reports by the World Bank, emerging markets and developing countries are expected to bear a major economic brunt of the ongoing Russia-Ukraine war. Global energy prices and commodity prices have been pushed up by ongoing conflicts. Retail inflation in India grew by a mammoth 7.8 percent in April 2022. To address the rising costs, the Reserve Bank of…
Debt collections is an important pillar in lending as it directly impacts the lender’s overall revenue and profitability. Growing purchasing power is accelerating the consumption of debt-based products in India, thereby, creating a promising growth opportunity for lenders. But at the same time, the need to recover debts is also increasing due to multiple factors. This brings forth the need…
Over the last seven years, gross non-performing assets (NPAs) of public sector banks (PSBs) have doubled, going from INR 2.24 trillion in 2014 to INR 5.40 trillion in 2021. As per a Reserve Bank of India (RBI) report, the gross non-performing assets (NPAs) of banks may increase from 6.9% in September 2021 to 8.1% by September 2022 under the baseline scenario and to…
As the world tries to return to a semblance of normalcy in a post-pandemic world, the lending industry is seeing some respite. A recent Moody’s report expects growth in bank loans to accelerate to 12-13% in FY 23 aided by increasing corporate earnings and easing of funding constraints for NBFCs. An Icra report predicts an 8.9-10.2 per cent growth for…
In the last decade, the financial sector in India has seen a paradigm shift in credit growth with Non-Banking Financial Companies (NBFC) acting as the key catalysts in this growth. As per data from the RBI, on March 31, 2021, the NBFC sector (including HFCs) had assets worth more than INR 54 trillion, equivalent to about 25% of the asset…
Introduction The word ‘Fintech’ is a portmanteau of the two terminologies- ‘finance’ and’ technology’. A debt collection fintech company in India is a form of business that utilizes technology to enhance or automate financial processes and services. Traditional financial services went through a radical transformation and emerged as a technology bases business. In the year 2015, the Fintech business witnessed…
What is a debt instrument? Any fixed income asset that allows the lender (or giver) to earn a fixed interest along with the principal amount while allowing the issuer (or taker) to use it to raise funds at a cost is called a Debt Market Instrument. Debt market instruments acts as a legal obligation on the issuer (or taker) who…
Origination of RDDBFI Act – An Introduction Banks and financial institutions that are properly registered by Reserve Bank of India ( RBI) provide legal entities and borrower entities with the loan facility. If the borrower fails in repaying the loan sum or part of it which includes unpaid interest and/or debt which is Non-Performing Asset (NPA), the debt may be…
“According to Black’s Law Dictionary, Arbitration in practice is the investigation and determination of a matter or matters of difference between contending parties, by one or more unofficial persons, chosen by the parties.” Overview In the Arbitration and Conciliation Act, 1996 section 16 describes the competency of an arbitral tribunal to rule on its own jurisdiction. The arbitration tribunal has…
“Mediation is a method of non-binding dispute resolution involving a neutral third-party who tries to help the disputing parties reach a neutrally agreeable solution.- Black Law Dictionary” Mediation is not a new aged Alternative Dispute resolution method but a traditional method. This method has been used in India for ages and is one of the most common methods used to…
Notice Demand notice (Dunning letter, soft legal notice/EMI reminder notice): Legal notice sent through an Advocate to the customer and place demand to pay the overdue amount. As and when the dues accrue, we can send this notice to customers anytime. We also can mention the time (Immediately, One week, 15 days) to repay the loan to hold further legal…