BoB to build ₹10,000-crore loan book in 2 years via digital co-lending platform

Bank of Baroda  on Monday launched an end-to-end digital platform to facilitate co-lending of retail, MSME (micro, small and medium enterprise) and agriculture loans in partnership with non-banking finance companies (NBFCs).

The bank is targeting to partner with at least 10 NBFCs and also to build a ₹10,000-crore co-lending loan book through the digital platform in the next two years.

The platform provides seamless integration between the bank and multiple NBFC partners to strengthenthe co-lending process, per the public sector bank’s statement.

“The platform uses rule-based algorithms for underwriting, enables credit assessment checks,…and increases process efficiency.

“The digital co-lending platform has capabilities to handle both the option 1 (Non-Discretionary) and option 2 (Discretionary) models of co-lending for secured as well as unsecured products as per the latest RBI guidelines on the co-lending model,” BoB said.

Seamless integration

Vikramaditya Singh Khichi, Executive Director, BoB, said, the Digital Co-Lending Platform will pave the way for both bank and its NBFC partners to seamlessly integrate and enable lending to borrowers with improved turnaround time.

Akhil Handa, Chief Digital Officer, BoB, underscored that the platform provides an end-to-end solution for the complex accounting issues that are common under co-lending.

Features such as dedicated escrow management and collections mechanism will help deliver a more efficient loan management cycle, he added.

Co-lending is a win-win for all the three stakeholders -- customers, partners and the bank. It provides last mile connectivity by enabling banks to reach out to new customer segments and improve the flow of credit. It enables NBFCs to access the bank’s low-cost of funds while offering customers loans at a lower rate of interest.

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