Liquidity is improving along with a decline in cost of funds, said Nirmal Jain, Chairman & CEO of IIFL Finance in an interview to CNBC-TV18.

On NBFCs, Jain said, “The sentiment is coming back in a positive way. People are looking at the sector and most of the people survived will now do well because as the economy recovers there will be demand for credit and no new players are coming in. therefore, I am personally optimistic that it may be a golden time for some of the NBFCs that survived and have got robust system and policies at the backend.”

Jain said there was a good bounce back in affordable housing, but the strongest demand has been in gold and business loans. He said the average ticket size for a home loan was Rs 15-16 lakh.

On the sources of funding, Jain said: “We have not tapped mutual fund market yet and I do not think mutual funds have started lending to NBFCs, but banks are willing to buy assets and they are keen to buy retail assets.”

He said his firm had adequate liquidity to meet next 9-12 months of repayments.