GTF Proposes NPA Act Coverage For NBFCs In Factoring & Forfaiting Biz

Font Size

Print

Feedback

Email

Discuss

Mumbai, April 9:: Mr Venkat Subramanian, chairman, Global Trade Finance and managing director, Exim Bank, has urged the Centre to bring non-banking finance companies undertaking factoring and forfaiting under the securitisation law, which has helped the banking industry recover considerable dues from wilful defaulters.

“We have written to the government on this issue and are hopeful of some action in this regard,” said Mr Subramanian, while announcing the financial result of GTF, a joint ventue company of WestLB, Export Import Bank and International Finance Corporation.

Mr Subramanium also announced that the four factoring companies in the country are forming an association to promote export finance. He also expressed hope that the Factoring bill, which is pending before the Parliament, would soon be enacted to help the export finance industry.

GTF, the only company in the country doing both factoring and forfaiting, has clocked an international factoring turnover of Rs 4.4 billion, and has asset size of Rs 2.2 billion during 2002-03. The company earned a profit after tax of Rs 13.24 million during the year.

According Ms Veena Mankar, managing director, GTF, Indian exporters are perhaps for the first time facing a strong rupee vis-a-vis the dollar. This calls for not just short-term reactions, but both short- and long-term strategies. In the short term, managing currency risk may be adequate, but the long-term requires improving quality and service at competitive pricing, which may not necessarily be the lowest price.