A non-banking financial company cannot
give loans
make investments
borrow from bank
seek demand deposits from public and cannot issue cheques
Answer is Wrong!
Answer is Right!
This question was previously asked in
UPSC CAPF – 2022
– Unlike banks, NBFCs cannot accept demand deposits (deposits withdrawable by cheque, draft, order or otherwise). They can accept time deposits (like fixed deposits).
– NBFCs are not part of the payment and settlement system, and they cannot issue cheques drawn on themselves.
– NBFCs are permitted to give loans, make investments in securities, and borrow funds, including from banks.
– NBFCs are regulated by the Reserve Bank of India (RBI), but the regulatory framework differs from that for banks.
– The primary distinction between banks and NBFCs lies in their ability to accept demand deposits and participate in the payment and settlement system.