Mumbai, Feb 9 (KNN) Bank of Maharashtra (BoM) has entered into a co-lending agreement for Micro, Small and Medium Enterprise (MSME) loans with LoanTap Credit Products Pvt Ltd, a Pune-based non-banking finance company.

The co-lending model provides ease of loan sanctions at borrower’s convenience through digital lending platforms, which cover end-to-end loan processing cycles without manual intervention or visiting bank branches.

Under the co-lending model, the bank will have an exposure of up to 80 per cent to an MSME customer. LoanTap will take the balance exposure.

''The co-lending system was introduced by the RBI in the wake of the liquidity crisis at NBFCs to enhance the credit flow to the unserved and underserved sector and make available funds to the ultimate beneficiary at an affordable cost,'' said AS Rajeev, Managing Director and CEO, BoM.

Hemant Tamta, Executive Director, BoM, said that the co-lending model will help the bank to meet the priority sector lending target. It will be beneficial for all – NBFCs having wider outreach and customers – who will be facilitated with low-cost credit from banks.