Consider the following statements regarding “NBFCs (Non-Banking Financial Companies)”: 1. NBFC’s raise funds from the public, directly or indirectly, and lend them to ultimate spenders. 2. NBFC’s advance loans to the various wholesale and retail traders, small-scale industries and self-employed persons. Which of the statements given above is/are correct?

[A] 1 only

[B] 2 only

[C] Both 1 and 2

[D] Neither 1 nor 2

Answer: C

Notes:

Explanation: NBFC’s raise funds from the public, directly or indirectly, and lend them to ultimate spenders.

They advance loans to the various wholesale and retail traders, small-scale industries and self-employed persons.
Thus, they have broadened and diversified the range of products and services offered by a financial sector.

Source: Ramesh Singh