SIDBI To Offer Credit To Micro Firms Through Fintechs Under DLAI

Panaji, Sept 25 (KNN) The Digital Lenders Association of India (DLAI) and the Small Industries Development Bank of India (SIDBI) have partnered to promote digital adoption in lending and develop policies to protect consumer interest.

The MSME centric financial institution will also explore offering its credit products to micro-enterprises through fintechs that are DLAI members.

The MoU signing was held at an event organised by DLAI in Goa on Saturday.

DLAI’s latest version of the industry code of conduct (CoC) was launched by Sivasubramanian Ramann, chairman and managing director of SIDBI.

The event that was attended by the top 100 executives of the Indian fintech industry.

The new version of CoC is structured around the RBI’s Digital Lending Guidelines. It considers important aspects such as responsible lending, transparency, fair debt collection practices, data privacy and security, and compliance with the regulatory framework.

“High growth in the Indian Fintech sector has been driven by best-in-class Public Digital Infrastructure (PDI) and matured policy support from the regulator. It’s for the industry to leverage the RBI’s digital lending guidelines to develop responsible lending practices, and the code of conduct prepared by DLAI is an important first step in this direction,” said Ramann. 

The MoU envisages collaboration between DLAI and SIDBI to develop standard protocols to expedite the adoption of digital lending partnerships, including alliances between banks and lending service providers (LSPs), co-lending collaborations, and developing model partnership agreements. 

SIDBI will support DLAI in its interventions in client protection, customer Grievance redressal mechanism, financial literacy, research and publications. 

“SIDBI is the apex Institution for the development of the MSME sector in the country. This partnership signifies an important step in India’s fintech journey for enhancing its role in financing the MSME sector. Both organisations are committed to leveraging our combined expertise and resources to pit the sector on a high growth trajectory with responsible lending with innovation embedded therein,”. Said Jatinder Handoo, CEO, DLAI.  (KNN Bureau)