Non-Banking Financial Companies (NBFCs) are financial institutions that provide various services similar to traditional banks but do not hold a banking license. They offer loans, asset financing, and investment products, catering to individuals and businesses. Unlike banks, NBFCs cannot accept demand deposits, meaning they do not offer checking accounts. NBFCs play a crucial role in the financial system by enhancing credit availability and promoting financial inclusion. They often focus on specific sectors, such as housing finance or microfinance, and are regulated by authorities like the Reserve Bank of India in India. Their flexibility and specialized services make them important players in the economy.