The point is that
to provide an investor N% returns,
these NBFCs need to generate >N% revenue from their activities.
In the recent years a major source of revenue for such NBFCs
has been shady “creative” lending tactics 
that prey on the financially weak/naive folks.
Here’s a somewhat detailed case-study - How did a Zero-Interest EMI loan generate 1400% APR returns.
Ethics and legality aside,
as an investor, what one needs to ask oneself is
if one’s invested capital is used to provide such loans,
if/when a significant percentage of individuals will start defaulting on such NBFC loans?
(and that’s the risk-assessment one needs to carry out before investing in such NBFCs)
There’s also another aspect to consider when investing in NBFCs.
NBFCs often raise a significant chunk of the capital for their activities using bonds.
Such bonds are usually of relatively short duration.
To maintain their cash-flow/liquidity,
and to service any longer-duration loans provided by the NBFCs to their customers/borrowers,
NBFCs will periodically need to float new series/tranches of bonds
to pay back the previously floated bonds that are now maturing.
(i.e. to pay back the capital of previous investors).
This is the inherent risk due to mismatch in the duration of…
- …the NBFC’s assets (any longer duration loans they have given out),
- …and the NBFC’s liabilities (the shorter duration bonds they have floated to raise their working capital).
Nothing fundamentally wrong with this approach.
This is prevalent in banking and formally know as an Asset-Liability mismatch and is measured as a Duration Gap.
However, one needs to pay attention to the amount of capital being raised periodically by the NBFC using such bonds.
Floating larger and larger bond IPOs to pay back previous investors with capital raised from subsequent Bond IPOs is a Ponzi scheme. Here’s a discussion on this topic and other related risks of NBFC bonds.