Risk management is paramount for NBFCs, given the implications on the ability to successfully raise funds from the market and potentially enlist on secondary markets through an IPO in the medium to long term, the joint report by Assocham and PwC said.
“With recent events increasing the scrutiny on NBFCs and their operations, it is imperative for players to build robust risk and governance models as they grow their lending business,” the report said.
It further said that NBFC lenders must develop and implement risk management frameworks to pro-actively detect, manage and mitigate internal and external risk types.
Some of the risks that these players need to manage include credit risk, vendor risk, conducting periodic compliance reviews, performing quality control checks to ensure process adherence and ensuring information integrity.
“NBFC lenders must guard against information leaks, which could potentially jeopardise the customer’s financial…
