Unsecured loans for MSMEs: Private sector lender Axis Bank on Thursday announced offering up to Rs 10 lakh unsecured MSME loans and Kisan Credit Card (KCC) for loans up to Rs 1.6 lakh per borrower under the pilot project of the Reserve Bank of India’s (RBI) Public Tech Platform for Frictionless Credit which commenced on Thursday (August 17). KCC loans will be offered in Madhya Pradesh.
Axis Bank said under the pilot programme, both loan products will be provided digitally and will not require any submission of documents by borrowers. The bank will leverage the tech platform by RBI’s Innovation Hub to access secure and consent-based customer data for PAN validation. AADHAR eKYC, Account Aggregator data, verification of land records, and penny drop services to validate bank accounts.
Rajiv Anand, Deputy Managing Director, Axis Bank, said, “This platform will bring immense efficiency to the lending process in terms of reduction of costs, quicker disbursement, and scalability. Meaningful growth in India can be driven by expanding the credit fold, and we are happy to continue playing a role in helping millions of Indians fulfil their financial dreams and aspirations.”
Given that the data will come directly from authenticated sources, the Bank expects to be able to offer faster and better credit services to customers, Axis Bank said. The lender added that it will expand the scale of existing products and launch new products through self-service and assisted modes on the basis of the learnings from the pilot project.
“Through the PTPFC, we will be able to access a variety of data required for underwriting directly from authenticated sources in a fully customer-consented and secure manner,” said Sameer Shetty, President & Head of digital Banking and Transformation.
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According to RBI, the data required for credit appraisal are available with different entities like central and state governments, account aggregators, banks, credit information companies, digital identity authorities, etc. However, they are in separate systems, creating hindrances in frictionless and timely delivery of rule-based lending. The platform will address this challenge with seamless access to information with lenders and bring efficiency to the lending process.