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Small Industries Development Bank of India (SIDBI) has entered into an agreement with a fintech Onion Life Private Limited to use the latter’s technology platform KarmaLife for a pilot to provide micro loans to gig workers. This is expected to support the gig workers’ financial inclusion to formal institutional credit.
KarmaLife will help gig workers access micro loans through a mobile app and eliminates the hassle of extensive paperwork or physical documentation.
This streamlined process will make it easier for gig workers to manage the liquidity needs of their enterprise activities. “Our partnership with Onion Life will help us understand and assist the new and emerging enterprise class of gig workers. The pilot will also help in developing an institutional mechanism for assessing the credit risk of this segment,” S Ramann, Chairman and Managing Director of SIDBI, said.
He said that SIDBI is committed to using the latest digital technology to provide affordable credit to different categories of micro-enterprises and fuel entrepreneurial aspirations across the country.
With the gig economy rapidly growing in India, there is a pressing need to provide affordable and accessible financial support to non-salaried gig workers who provide their services through gig platform aggregators for livelihood.
Rohit Rathi, Co-founder and CEO, said, “We are excited to be associated with SIDBI, which will empower gig workers with the financial resources they need to thrive in the gig economy. Our mission is to find effective solutions to help gig workers efficiently manage liquidity for their enterprises.”
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