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RBI Propels Open-Source Credit Platform To Empower Farmers & MSMEs

Updated: Feb 24, 2024 03:46:27pm

RBI Propels Open-Source Credit Platform To Empower Farmers & MSMEs

New Delhi, Feb 24 (KNN) The Reserve Bank of India (RBI) is leading the charge for broader adoption of an open-source credit disbursal platform akin to the Unified Payments Interface (UPI).

This platform is aimed at facilitating easier access to credit for farmers and small business owners, reported ET.

Despite the prevalence of digital consumer loan disbursals, farmers and small business operators still endure lengthy queues at local bank branches and land records departments to secure agricultural loans and obtain Kisan credit cards.

The Public Tech Platform for Financial Credit (PTPFC) has been conceived to tackle this challenge head-on. Lenders and startups have the opportunity to integrate with the PTPFC platform, effectively meeting the escalating demand for formal credit. 

Already, the platform is fueling agricultural loans, Kisan credit cards, small-value MSME loans, and similar products. The PTPFC is envisaged to address this issue.

Lenders and startups can plug into the PTPFC platform to cater to the growing need of formal credit. The platform is already powering agri loans, Kisan credit cards, small value MSME loans and other such products.

The Reserve Bank Innovation Hub, along with the central bank's fintech department, is driving this programme, said a senior banker in the know.

Around Rs 3,500 crore worth of loans in agri and MSME have been disbursed through the platform," the banker said. The RBI did not respond to emailed queries.

Industry estimates suggest that more than 30 per cent of the farmers in the country take loans at rates as high as 3 per cent per month from local trading hubs or moneylenders. 

A digital credit disbursal platform from banks can help them reduce their input costs by as much as 30 per cent, say industry insiders.

(KNN Bureau)


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