A Study on Credit Risk Management in a Non-Banking Financial Company (NBFC)
Keywords:
Credit Risk Management, NBFC, Loan Repayment Behaviour, Customer Satisfaction, Credit Assessment.Abstract
Credit risk management plays a crucial role in ensuring the financial stability and profitability of Non-Banking Financial Companies (NBFCs). This study examines on credit risk management. The study aims to understand the loan approval process, analyse customers' repayment behaviour, and evaluate customer satisfaction regarding the company's credit risk management.
The study is based on primary data collected through a structured questionnaire administered to 73 borrowers of Finnable credit pvt ltd. Descriptive statistics, percentage analysis, correlation analysis, and regression analysis were used to analyse the collected data.
The findings reveal that the majority of respondents are self-employed borrowers who prefer business loans and maintain a good repayment record. The correlation analysis indicated a strong positive relationship between monthly income and EMI repayment behaviour (r = 0.891). The regression analysis showed that the model explains 93.1% of the variation in repayment behaviour (R² = 0.931), indicating excellent explanatory power.
The study concludes that NBFC. has adopted an effective credit risk management system that ensures high customer satisfaction, minimizes loan defaults, and strengthens the company's overall financial performance.
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