Indian economy today is observing a phase of phenomenal growth. The country has seen year on year growth rate of about 8–9 per cent in the last 3–4 years. Financing requirements are also rising commensurately and will continue to increase in order to support and sustain the tremendous economic growth. As we all know, NBFCs have been playing a complementary role to the other financial institutions including banks in meeting the funding needs of the economy. They help fill the gaps in the availability of financial services that otherwise occur in bank-dominated financial systems. Equally importantly, NBFCs provide competition for banks in the financial services domain. In fact, diversification of financial markets is an important component of financial sector reforms. As mentioned in the C. M. Vasudev Committee Report on NBFCs, meeting the financing needs of all sectors of the financial system needs products and institutions which are in a position to absorb these risks. It is an established fact that the development of financial intermediaries contributes strongly to economic growth; and that contribution is increased where intermediation is provided through a balanced combination of NBFCs and banks–in particular, there is a strong correlation between the depth and activeness of non-banks and stock markets on the one hand, and economic development on the other. RBI reports on Banking Trends have recognized the role played by the NBFCs.