MUMBAI: Smaller and weaker non-bank financiers face more difficulty in raising debt compared to their peers with stronger parentage as risk aversion intensifies amid the covid-19 crisis.
The covid-19 pandemic has affected the funding of most non-banking financial companies (NBFCs) with bond spreads over the three-year government securities rising by another 50-70 basis points (bps), against the 250-300 bps existing spread.
Spreads indicate the difference between yield of a particular bond and yield on the government securities (Gsec), with same maturity.
Experts said smaller and weaker non-bank financiers have either not been able to raise money or have had to settle for less at a higher rate.