Total assets under management of NBFCs are likely to shrink for the first time in 20 years as per a report brought out by CRISIL. NBFCs last went through a severe crisis in 1998 when the new prudential norms were introduced. Now, the pandemic has created a new set of problems for these financials.

NBFCs are cautious about the likely impact of the EMI moratorium being lifted. Most NBFCs are worried about a possible spurt in gross NPAs which is forcing many of these players to shrink their balance sheets. NBFCs had nearly 55% of their loan books under EMI moratorium as of Mar-20. That has improved, but only for the stronger players.