Chennai-based Yubi, formerly CredAvenue, announced its partnership with the country’s largest lender State Bank of India (SBI), to help grow the bank’s co-lending portfolio.

As per the partnership, SBI will be integrated with Yubi Co.Lend, the co-lending platform of Yubi, that provides an end-to-end solution and enables lenders to collaborate with multiple partners with a quick one-time application programming interface (API) integration. 

In a press release, Yubi said the strategic alliance aims to facilitate seamless and faster credit to the priority sector and reduce the country-wide credit gap. 

“Yubi’s tech-enabled end-to-end co-lending infrastructure will help expand their (SBI’s) loan portfolio across asset classes. This partnership has the potential to unlock $1 trillion in capital for Priority Sector Lending in tier 2,3,4 cities, small enterprises, and farmers,” Gaurav Kumar, Founder and CEO, Yubi, was quoted in the release. 

In November 2020, the Reserve Bank of India introduced a co-lending model, under which banks can provide loans in partnership with NBFCs (including housing finance companies) to priority sector borrowers based under a prior agreement. The model was introduced to improve the flow of credit to the unserved and underserved sector of the economy and to make available funds at a cheaper rate by leveraging both bank’s low cost of funding and the wider reach of NBFCs.

On Yubi’s co-lending platform, SBI can choose its co-lending partners including NBFCs, HFCs or fintechs, create its co-lending product programme, and digitally manage operations. Multiple asset classes will be covered by this model. 

“Yubi will also build, manage and monitor SBI’s co-lending portfolio. The platform will also ensure all compliance to enhance the user experience,” the company added. 

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