Non-Banking Financial

Points Banks
Companies

NBFC is a company engaged in

the business of loans and
advances, acquisition of shares,
stocks, bonds, debentures, and
The bank is an RBI-authorized financial
securities issued by the
Meaning institution that aims at providing
Government or local authority or
banking services to the general public.
other marketable securities of a
like nature, leasing, hire- purchase,
insurance business, and chit
business.

NBFCs can accept only term

Banks can accept term deposits as well
Demand deposits deposits but not demand
as demand deposits.
deposits.

Payment & settlement Banks form part of the payment and NBFCs do not form part of the
system settlement system. payment and settlement system.

Banks can issue cheques drawn on NBFCs cannot issue cheques

Cheque
themselves. drawn on themselves.

Banks are termed as creators of credit NBFCs cannot be termed as

Credit creation
through money multiplier activity. creators of credit.

Banks provide a variety of transaction NBFCs do not facilitate transaction

Transaction services
services. services.

Banks are required to maintain reserve NBFCs are not required to

Reserve ratios
ratios with RBI. maintain reserve ratios with RBI.