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Fintech firms seek more credit from banks

Fintech firms seek more credit  from banks
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Fintech firms seek more credit from banks

Highlights

Fintech companies seek provision in the upcoming Budget for higher credit flow from banks and non-banking finance companies (NBFCs) for these new-age players

Bengaluru: Fintech companies seek provision in the upcoming Budget for higher credit flow from banks and non-banking finance companies (NBFCs) for these new-age players. According to company officials, carving out special liquidity and guarantee schemes for fintech firms in the Budget will ensure higher credit flow from this segment.

"We expect the Budget for FY2022 to outlay liquidity and guarantee schemes which can help in increasing the credit supply and help to make capital more accessible to NBFCs. We are anticipating the NBFC sector to grow at a moderate rate and are hoping that the sector also gets fresh funding to support the moderate growth in the coming year," Rohit Garg, Co-Founder and CEO of SmartCoin. SmartCoin is an app-based micro-lending platform providing small-ticket loans to the deprived sections of society. He also said the upcoming Budget should promote more banks and larger NBFCs to partner with new-age NBFCs and fintechs who are providing credit to those who are not served by the banking system.

"We also propose partnerships with established banks and NBFCs with fintech players, which will create an environment receptive towards initiatives such as Sahmati- account aggregator among others," Garg added. Officials of other fintech firms said that expanding the scope of the co-origination model will give a fillip to disbursal in the system.

"There has been a widening scope of the RBI's co-origination model, and now the Finance Minister is asking banks to use this model to collaborate with fintechs and share lending risks equally. If this measure comes into effect, it will reflect a growing and necessary acceptance of the key role that fintechs play in the world of banking and finance," said Nityanand Sharma, Co-Founder, and CEO of digital payment solution provider, Simpl. Similarly, specialised fintech players such as RevFin, which lends to customers buying electric vehicles apart from providing personal loans, said the Budget should carve out special funds for promoting the electrical vehicle segment.

"We expect the Budget for FY2022 to enable the EV industry to grow and become one of the largest contributors to the GDP. For the industry, the biggest challenges are access to credit and the cost of credit.," said Sameer Aggarwal, Founder & CEO of RevFin.

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