Liquidity constraints faced by NBFIs will tighten credit supply: Moody's

Liquidity constraints faced by some non-bank financial institutions (NBFIs) will tighten credit supply and slow growth to a little over 7 per cent for the current fiscal, Moody's Investors Service said Thursday. "...The liquidity constraints faced by some NBFIs in India, after the default of Infrastructure Leasing & Financial Services Ltd (IL&FS) in September 2018, will likely tighten overall credit supply in the country," Moody's said in a statement. Besides, any further distress in the NBFI sector will pose significant downside risks to India's growth outlook, it said. Moody's Managing Director and Chief Credit Officer (Asia Pacific) Michael Taylor said India's GDP growth will slow to just above 7 per cent for fiscal 2019 and 2020. Indian economy grew at 7.1 per cent in the July-September quarter, lower than 8.2 per cent in April-June. The rating agency said NBFIs are an important provider of credit to the economy and, in the fiscal ended March 31, 2018, accounted for nearly

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