Home Credit India, the local arm of the international consumer finance provider, has tied up with Karur Vysya Bank (KVB) for a joint lending initiative in the unsecured lending space.

Under this first of its kind agreement, Home Credit and KVB will disburse the loan as a single amount to the customer. The uniqueness of this partnership is in the end-to-end automated processing by which the customer gets real time approval and disbursement.

Under this arrangement, Home Credit India will facilitate the sourcing and servicing of the loans originated under this scheme. Underwriting will be done jointly on real time basis on a fully digitised platform.

Speaking on this tie-up, Anirban Mazumdar, CFO, Home Credit India, said that we will now be able to reach out to a new segment of customer on the back of this partnership and by leveraging on the lower cost of funds of KVB.

"Going forward, joint lending is a successful and practical way of lending for NBFCs and I am pleased that we have pioneered the same with a strong player like Karur Vysya Bank. I look forward to this partnership successfully serving the underserved segment and broadening financial inclusion in India", he said.

P R Seshadri, Managing Director and CEO, Karur Vysya Bank, said "this partnership will help us leverage Home Credit India's large data base, reach out to a segment which we had not pursued aggressively in the past and we will be able to provide other banking products to these customers, as well".

Retail lending is seeing robust growth in volumes and transactions across all portfolios due to the rising aspirations of Indian customers. NBFCs are also set to gain in these partnerships as it results in lower costs of funding loans. Therefore, joint lending of unsecured loans is seen as a viable business growth proposition.

srivats.kr@thehindu.co.in

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