Difference between Financial Institutions and Non Banking

Financial Institutions

The main difference between financial institutions and non banking financial institutions
are given below:

Compariso Financial institutions Non-banking financial institutions

n chart

i) Definition A Bank or Financial A NBFI (Non Banking Financial

institutions is an Institutions) is an organization that does
organization that accepts not accept customer cash deposits but
customer cash deposits and provides all financial services except bank
then provides financial accounts.
services like bank accounts,
loans, share trading account,
mutual funds, etc.
ii) Interacts A bank interacts directly An NBFI
with customers interacts with banks and governments.
iii) A bank indulges in a number An NBFI is mainly
Concerned of activities relating to concerned with the term loan needs of
finance with a range of large enterprises.
customers.
iv) Deals A bank deals with both An NBFI is mainly concerned with the
internal and international finances of foreign companies.
customers.
v) Main A bank's main interest is to An NBFI's main interest is in the
interest help in business stabilization of the currency.
transactions and savings/
investment activities.