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Most of us have grown up with one belief - if you need a loan or want to save money, you go to a bank. But over the last decade, millions of Indians have been quietly borrowing from a different kind of institution, one that works a lot like a bank but technically is not one. These are called NBFCs, or Non-Banking Financial Companies.

If you've ever wondered why there are so many loan companies in India beyond your regular bank, the ones financing your two-wheeler, your small shop, or even that gold loan, you're looking at NBFCs. And yes, the RBI not only knows about them, it actively wants them around.

Most people come across the term NBFC at some point, maybe while applying for a loan or while reading something in the news, and just move on without really understanding what it means. Fair enough, since the full form alone (Non-Banking Financial Company) doesn’t always make things immediately clear.