NBFC-L&T FINANCE

Group Members
 NBFC
It means
 A financial institutions that is company
 A non-banking institution that is a company whose principal

business is the receiving of deposits under any scheme or

arrangement or lending in any manner
 Other non banking institutions with prior approval of GOI.
 It excludes FI which carry on agricultural operations as their

principal business.
 It is only non banking institution that is any hire-purchase

finance, investment, loan or mutual benefit financial company

and an equipment leasing company but excludes and
insurance company/stock exchange/stock broking company/
merchant banking company.
Other names of NBFC’s 1. Non-banking financial institutions 2. Non-depository credit intermediaries 3. Lending companies  

 FROM 6,DEC 2006 THE NBFC ARE…

 Investment Company (IC)
 Loan Company (LC).
 Asset Finance Company (AFC)
 'AFC' is defined as a financial institution whose
principal business is that of financing the
physical assets which support various
productive/economic activities in the country.
.

Registration

 Does NBFC registered with RBI :

 Does NBFC registered with RBI IN section 45-IA RBI Act,1934
NBFC should be registered with RBI. BUT not for all category
of NBFC’s. There are certain category of NBFC which are
regulated by other regulators
  

As….. Housing finance companies are regulated by

NATIONAL HOUSING COMPANIES Venture capital fund
,Stock broking companies are registered with SEBI.
Insurance companies holding a valid certificate of
registration issued by IRDA. Nidhi companies registered
under section 620-A companies Act 1956
 Difference between NBFC & BANKS
 A NBFC cannot accept demand deposits (demand
deposits are funds deposited at a depository
institution that are payable on demand -
immediately or within a very short period - like
your current or savings accounts.
 It is not a part of the payment and settlement
system and as such cannot issue cheques to its
customers; and
 deposit insurance facility of DICGC is not
available for NBFC depositors unlike in case of
banks.
 Types of NBFC
1. An equipment leasing company ( ELC)
2. A hire purchase company ( H PC)3
3. An investment company (IC)4
4. A loan company(LC)5
5. A mutual benefit financial companies ( M
BFC)I.e. Nidhicompanies
 Categorization of NBFC
 Depending on the nature and type of service
provided.
 Asset Finance, Consumer Finance, Investment,
and loan company, and factoring and forfaiting
organization-RBI
 Housing finance companies-NATIONAL H
OUSING BANK
 Merchant banking organizations, stock broking
firm,depositories, credit rating agencies, and
venture capitalfunds-SEBI
 Functions of NBFI
 Brokers of the Loanable funds.
 Mobilization of savings.
 Channelisation of Funds into Investment.
 Stabilize the Capital Market.
 Provide Liquidity
 Role of NBFCs
 As recognized by RBI and expert committees

 Development of sectors like Transport & Infrastructure

 Substantial employment generation
 Help & increase wealth creation
 Broad base economic development
 Irreplaceable supplement to bank credit in rural segments
 major thrust on semi-urban, rural areas & first time buyers /
users
 To finance economically weaker sections
 Huge contribution to the State exchequer
 Role of NBFCs (Contd..)
 70-80% of Commercial Vehicles are finance driven

 Indian economy is more dependent on roads

 Heavy Govt. outlay for mega road projects
 Heavy replacement demand anticipated – 30 lacs commercial
vehicles by the year 2007
 Another Rs.6000 Crores required for phasing out old
commercial vehicles
 CRISIL in its study has placed commercial vehicle financing
under “low risk” category
 Each commercial vehicle manufactured, sold and financed
gives employment to minimum 20 persons (direct and indirect)
 Role of NBFCs

 As recognized by RBI & Expert Committees /

Taskforce
 Development of sectors like Transport & Infrastructure
 Substantial employment generation
 Help & increase wealth creation
 Broad base economic development
 Irreplaceable supplement to bank credit in rural segments
 major thrust on semi-urban, rural areas & first time
buyers / users
 To finance economically weaker sections
 Huge contribution to the State exchequer
 Requirement for registration :

 Requirement for registration A Non Banking financial

Company should have minimum net owned fund 2
crore. The company is required to submit it’s
application for registration in the prescribed format
along with necessary documents for bank
consideration.
 Eligibility criteria
 Eligibility criteriafor accepting Public Deposits An NBFC
having NOF of Rs 200 lakhs and above can accept public
Deposit. It has to obtain Minimum Stipulated Credit Rating
from any one of the approved Credit Rating Agencies at least
once in a year.
Copy of the Credit Rating should be sent to the RBI along
with the Return on Prudential Norms. The NBFC should have
acquired a credit rating of not less than AAA rating or its
equivalent in the previous year. 16 Non Banking Financial
Company (NBFC) 9/9/2009
 About L&T Finance

• L&T Finance Limited (LTF) is one of the wholly owned subsidiaries

of Larsen and Toubro. It was incorporated as a Non Banking Finance
Company in November 1994. Through LTF, L&T aims at making a
strong foray in the ever-expanding financial services sector.
• LTF offers a spectrum of financial products and services for trade,

industry and agriculture. The company's focus segments are

corporate products, construction equipment, CVs and tractors.  
Larsen & Toubro Ltd is a USD 9.8 billion technology, engineering and
construction group with operations spread across the globe. It was ranked as
14th by the Economic Times in their survey of the Top 500 Companies in
India. Another feather in its cap was added when L&T was ranked 47th in the
world in the June 2009 issue of Forbes-Reputation Institute’s “World’s Most
Reputable Companies” survey. In this survey, L&T was the only engineering
and construction company in the world to have made it to the top 200.
 PROFILE
 L&T Finance Limited (LTF) is a subsidiary of Larsen and Toubro.
It was incorporated as a Non Banking Finance Company in
November 1994. Through LTF, L&T aims at making a strong foray
in the ever-expanding financial services sector
 Mission
 To be a strategic business partner and a solution provider
 To nurture human capital and develop leadership for professional
excellence through meritocracy and continuous learning
environment.
 Vision
 To be a dominant player in financial services, committed to
constant innovation and sustained customer service to enhance
shareholder's wealth. LTF will foster trust, uphold integrity and
radiate positive energy."
 Management
Y. M. Deosthalee, Whole-time Director and CFO, Larsen &
Toubro Ltd. Mr. Deosthalee joined Larsen & Toubro
Limited (L&T) in 1974 and assuming charge as General
Manager (Finance) in 1990

Sivaraman, Senior Vice President, Financial Services, Larsen &

Toubro Ltd.N.

R. Shankar Raman,  Senior Vice President, Finance & Legal,

Larsen & Toubro Ltd.

Dinanath Dubhashi,  Chief Executive

 Commercial Vehicle Finance
• Commercial Vehicle Finance In 1996, L&T Finance had
made a foray in financing of commercial vehicles.
• L&T Finance offers financing Commercial Vehicles of
all makes and sizes. We also undertake funding of the
body for the Commercial Vehicles.

Advantages of partnering with L&T Finance

Presence in more than 70 locations
Flexible repayment option
Competitive interest rates
Finance for used vehicles available
Faster loan approval and disbursement
 Rural Finance
• L&T Finance's Rural product finance division caters to the finance
needs of the rural customers and helps them to realize their dreams.
• L&T Finance offers Rural Financing in 17 states with 72 branches and
a dedicated field force.

Advantages of partnering with L&T Finance

Presence in more than 75 locations covering more than 220
districts
Customized repayment option
Faster processing time
Attractive interest rate
Flexible repayment option
Strong presence in Semi-Urban and Rural India
Credit life insurance cover available
 Microfinance

Loan Amounts
Loan amounts may vary from member to member between Rs. 10,000/- to Rs. 20,000/-.

Tenure of Loan and Frequency of Repayment

Microfinance loans are issued for a tenure of up to 12-18 months and
recovered in equal monthly or weekly installments.
Agriculture loans are issued for approx. 8 to 10 months and recovery is
scheduled in 2 installments synchronizing with the harvest time which
falls mostly in May and December months.
 Working Capital Finance
• At L&T Finance we understand that effective management of cash
flows is of paramount importance for success of your business.
We, at L&T Finance cater to these needs in order to enhance your
business competency as well as that of your strategic partners.

Advantages of partnering with L&T Finance

Stable and improved cash flows
Faster and timely availability of funds
Reduction in levels of receivables
Payment risk transferred away from you
Largely reduced responsibility of client management
 Corporate Finance
• As a budding corporate, gunning for success, you
cannot let lack of financing for your equipment hold
you back. At L&T Finance, it is our endeavour to
support you as you grow from strength to strength and
scale the ladder of success..

Advantages of partnering with L&T Finance

Attractive interest rate offered
Instant cash for you
We maintain minimum TAT in loan sanctioning
& disbursement
Customer orientation - we match the repayment
terms with your company’s cash flows
Tax benefits can be claimed by you
 Loan Against Securities
• As a promoter, a corporate, a high net worth individual
or a retail client, fortifying, expanding and managing
your capital market portfolio is an important aspect of
augmenting your income and cash flows.

At L&T Finance we offer you products that finance

your capital market investment. Ranging from offering
loans on your existing securities to financing IPOs and
ESOPs, we provide you with diverse offerings for you
to choose from, fulfilling all your needs under one roof.
 Project Finance
• nder Project Financing we offer products for business
development, project appraisal and client relationship
management. This includes portfolio monitoring and
collections.

PFG structures and provides customised solutions such as term

debt, sub-debt, quasi-equity funding, equity investments, etc.

The project appraisal process includes risk analysis. These risks

are mitigated through appropriate project structuring, and
enhance project viability.
 Insurance and Mutual Funds
• L&T Finance provides personalized financial solutions to retail
customers in the form of Insurance and Mutual Funds. L&T Finance
is also involved in selling risk products to the open market. These
products are offered to you under the Smartrupee brand name.

•Transactional Services
We at L&T Finance service your needs by provide transaction facility in
mutual funds, corporate FDs, bonds, reminders on insurance premiums,
information on new fund offers, IPOs etc
•Risk Mitigation
L&T Finance sells risk mitigation products of motor, health etc. CPM
packages are provided to loan customers. Creditlife products to supplement
Micro Finance loans are also offered.

Advisory Services
Financial Highlights
Financial Highlights
Homepage