An NBFC will take a file a bank has refused — weaker score, informal income, unusual employment — and price that risk in. Knowing when that trade is worth taking is the whole decision.
Last reviewed · Money Bharti is a loan marketplace, not a lender
An NBFC will look at a file a bank has already refused — a weaker score, income that is real but hard to document, employment that does not fit a template — and lend against it. That flexibility is priced in. The decision is simply whether the trade is worth it for you.
And the reverse: if your score is above 750 and your employer is well graded, going straight to an NBFC usually costs you money for no reason. Check a bank first.
Did you know?
A rejected bank application does not stay private. The hard enquiry is recorded on your credit report whether you were approved or not, and several in a short span read as distress to every lender who looks afterwards. This is why applying to a bank you are unlikely to clear, and then to an NBFC, can leave you worse off than going to the NBFC first — you arrive with a lower score than you started with.
This distinction matters more than any rate comparison on this page. An NBFC registered with the RBI is a regulated lender: it must follow fair practices rules, disclose the annual percentage rate, follow recovery norms, and give you a grievance route that ends at the RBI Ombudsman.
An unregistered lending app is none of those things. The warning signs are consistent and easy to spot:
| Warning sign | What it means |
|---|---|
| A fee demanded before sanction | No legitimate lender does this |
| Access to contacts, photos or gallery requested | Being collected for recovery harassment |
| No RBI registration number, no registered address | Not a regulated lender |
| Rate quoted per day or per week | Hides an annualised rate that is usually enormous |
| Approval promised with no credit check | Either untrue or not a real loan |
Before borrowing from any NBFC you have not heard of, check its name on the RBI's public list of registered NBFCs. It takes a minute and it is the single most useful safety step available to you.
Expert insight
If an NBFC is your only current option, treat the loan as a bridge rather than a destination. Take the smallest amount that solves the problem, on the shortest tenure you can carry, and repay it without a single missed instalment. Twelve months of clean repayment on an NBFC loan is one of the fastest ways to lift a score into bank territory — at which point a balance transfer to a bank at a materially lower rate becomes available. Borrowers who plan that sequence from the start pay a high rate for a year rather than for five.
| NBFC | Distinctive for | Guide |
|---|---|---|
| Bajaj Finance | Flexi drawdown limit — interest only on what you withdraw | Bajaj Finserv personal loan |
| Tata Capital | NBFC speed with a bank-level score bar — not a fallback for a weak file | Tata Capital personal loan |
| Aditya Birla Capital | No income floor for self-employed; judged on business history instead | Aditya Birla personal loan |
| Muthoot Finance | Gold loan alongside the unsecured one, and no credit score needed for it | Muthoot personal loan |
| Poonawalla Fincorp | One month with your current employer, and no foreclosure charge on own funds | Poonawalla Fincorp personal loan |
| Hero FinCorp | Small tickets from ₹15,000 income, and self-employed assessed without ITR | Hero FinCorp personal loan |
Note how widely these differ. Tata Capital and Aditya Birla expect scores of 725 and 750 — at or above several banks — while others in the market work from around 650. "NBFC" is not a synonym for easy approval, and picking the wrong one still costs a hard enquiry.
Please note
Money Bharti is a loan marketplace, not a lender, and is not affiliated with or endorsed by any NBFC named on this site. The ranges described here are indicative of how NBFC lending generally works, not any specific lender's policy, and change without notice. Always verify a lender's RBI registration and confirm all terms directly before applying.
Q1. What is an NBFC?
A non-banking financial company — an RBI-registered lender that provides loans without holding a banking licence. It cannot accept demand deposits, but it lends under RBI regulation.
Q2. Is it safe to borrow from an NBFC?
From an RBI-registered NBFC, yes. The trade-off against a bank is the rate, not the safety. Unregistered lending apps are a different matter entirely.
Q3. Why do NBFCs charge more than banks?
They accept weaker scores, informal income and unusual employment, and their own cost of funds is higher than a bank's. Both feed into the rate.
Q4. What credit score do NBFCs accept?
Commonly from around 650, and some lend lower at much higher rates. See our low CIBIL page.
Q5. How do I check whether a lender is registered?
Look up the company name on the RBI's published list of registered NBFCs. If it is not there, do not borrow.
Q6. Can I move an NBFC loan to a bank later?
Yes, through a balance transfer once your score improves. Run the numbers on our balance transfer calculator — the rate gap has to cover the switching charges.
Q7. Are NBFC loans faster than bank loans?
Generally yes, often same day, because processing is more digital and criteria are more flexible.
Q8. Does an NBFC loan affect my credit score differently?
No. It is reported to the bureaus like any other loan, and repaid cleanly it builds your score the same way.
NBFCs exist to lend where banks will not, and they charge for that. If your score or your paperwork keeps you outside bank criteria, this is the sensible route — and applying to a bank first, purely to try, tends to leave you worse off than going here directly.
Two things to do before you sign: verify the lender's RBI registration, and plan the exit. Borrow small, repay clean, and revisit a bank in twelve months. If your profile is already strong, start with a bank instead.
Money Bharti checks your details against 100+ RBI-registered banks and NBFCs with a soft enquiry — nothing recorded against your CIBIL score, and comparing is free.
Check my eligibilityGet a free, no-obligation eligibility check and compare real offers from 20+ RBI-regulated Banks & NBFCs — with zero impact on your credit score.
🚀 Check Your Eligibility — Free