Opex isn’t just field. Understanding NBFC operating cost structure

When we look at Opex in lending businesses, the instinct is simple:

Cost = branches + LOs + field operations

And then the discussion becomes:

• Productivity per LO

• Cost per branch

• AUM per branch

All valid.

But incomplete.

NBFC operating cost structure has three layers

In reality, NBFC operating cost structure sits in three distinct layers:

1. Field Engine (visible)

• Sourcing

• Collections

• Branch staff

• Direct supervision

This is what everyone tracks.

2. Control Layer (semi-visible)

• Credit reviews

• QC / audit checks

• Risk monitoring

• Exception handling

This grows quietly—especially when things go wrong.

3. Support Layer (least visible)

• HR, training

• IT, systems

• Ops support

• MIS, reporting

• Coordination overhead

This is where complexity hides.

Why NBFC opex keeps rising despite productivity focus

When performance slips (PAR, growth, productivity), the response is rarely structural.

Instead:

• Add another review

• Increase sampling

• Add a call

• Add a tracker

• Add a team

Each step feels small.

But cumulatively:

• Control layer thickens

• Support layer expands

• Coordination increases

And suddenly:

Opex has gone up — but nobody can point to one decision.

SARTHI NBFC Operations Framework | Opex Drift

This is not cost. This is operating design

Most cost conversations stay at:

• “Reduce cost”

• “Improve productivity”

But the real issue is:

How much structure is required to run the business?

Two organisations with the same AUM can have very different NBFC operating cost structures because:

• One resolves issues early (field level)

• The other escalates and re-reviews

That difference sits in:

• Control design

• Escalation paths

• Review density

• Support dependency

SARTHI NBFC Operations Framework | Opex Reduction

A simple way to diagnose your cost structure

Ask three questions:

1. How many times is the same case reviewed?

2. How many teams touch one issue before closure?

3. How many forums discuss the same problem?

If the answer is “multiple”—

You are not seeing a cost problem.

You are seeing a structure problem.

Impact on operational efficiency in NBFCs

Expanded control and support layers lead to:

• Higher fixed cost

• Slower decisions

• Lower productivity

• Delayed growth response

And importantly:

Cost increases without a proportional improvement in risk.

SARTHI perspective: Opex is a design outcome

From a SARTHI lens, Opex is not just a number.

It is an outcome of:

• How processes are designed (Approach)

• How consistently they are executed (Deployment)

In practice, we see:

• Strong design but weak deployment → repeated reviews → higher control cost

• Weak design → dependence on supervision → higher support cost

• Misaligned routines → escalation → layered cost

Which means:

Opex is not controlled by cost actions. It is controlled by operating design and field execution discipline.

What strong organisations do differently

They don’t avoid control.

They design it better.

• Resolve more at source

• Reduce duplicate reviews

• Keep escalation paths tight

• Build clarity into field decisions

• Use support to enable—not to compensate

Closing thought

If your Opex conversation is only about field productivity, you are seeing only part of the picture.

A meaningful improvement comes from understanding:

How your NBFC operating cost structure is built—across field, control, and support.

That is where the real opportunity sits.

SARTHI is a structured operations framework for NBFCs and MFIs that improves growth, risk, and efficiency outcomes by strengthening field execution through 300+ defined practices.

To know more, visit sarthiworks.com