Credit rating agency ICRA has projected debt funding for Medium and Small Non-Banking Financial Companies (NBFCs) to reach Rs 2.2 trillion over the next two financial years (2024 and 2025). The forecast is attributed to high growth expectations and limited fundraise by most entities. ICRA anticipates the Assets Under Management (AUM) of the industry to grow at a compound annual growth rate (CAGR) of 25-30% during this period. The borrowing profile of smaller NBFCs currently involves approximately 60% from bank loans and loans from other financial institutions, with the remaining 40% from other sources. The projections also highlight the importance of co-lending, securitization, and capital infusion for these entities.