NBFCs expect rise in borrowing cost as RBI may jack up repo rate further

In its FY24 outlook for the NBFC industry, India Ratings & Research had said that till now there has been a stable funding environment for the NBFCs due to efforts undertaken by the RBI and the Centre.

- PIYUSH SHUKLA

NON-BANKING FINANCE companies are expecting up to 30 basis points rise in their borrowing cost in next financial year as they expect the Reserve Bank of India to hike repo rate in its April Monetary Policy Committee meeting by 25 basis points, industry players said.

While the non-banking finance companies (NBFCs) will be able to pass on the rate hike to borrowers in case of external benchmark-linked loans, they will struggle passing the same in fixed rate loan products such as vehicle and MSME loans, they add.