Indian Financial System
Quick practice
Question 1 of 5
While both Commercial Banks and Non-Banking Financial Companies (NBFCs) engage heavily in the business of lending money, what is the primary structural restriction placed upon an NBFC that fundamentally separates it from a traditional Bank?
An NBFC is strictly prohibited from accepting Demand Deposits (like savings and current accounts) that are repayable strictly on demand.
An NBFC is strictly prohibited from charging any interest on the loans it issues to consumers.
An NBFC is strictly prohibited from operating more than five physical branch locations.
An NBFC is strictly prohibited from granting loans to private manufacturing corporations.
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