Yubi, a unified credit platform for corporates and lenders and Lendingkart, a retail lending marketplace, have entered into a strategic partnership to collaborate and in the process, empower the priority sector by simplifying access to finance.
Lendingkart will use Yubi’s co-lending marketplace, Yubi Co.Lend's network of lenders to disburse joint loans through its non-banking financial company (NBFC), Lendingkart Finance. Additionally, the partnership includes the co-origination of loans in a 100:0 model on Lendingkart's software as a start-up (SaaS) platform, 2gthr, for the micro, small and medium enterprise (MSME) sector.
As a result of a dynamic economic environment and rising interest rates on loans, MSMEs are seeking more affordable credit to fuel their growth and expansion plans. Meanwhile, financial institutions are seeking innovative methods to diversify their loan portfolio and expand sustainable lending to the priority sector to keep the economic engines of the country running. Co-lending has become the model of choice because of its dual ability to reduce risk and increase leverage, explained the companies.
Further, they added that the strategic partnership will enable additional disbursement of loans and help cater to the increasing demand from MSMEs in the ecosystem. The partnership will enable last-mile finance and drive financial inclusion with swift and collateral-free loans to eligible MSMEs with disbursals. This will in turn help deepen the debt market by allowing banks and financial institutions to diversify their existing loan book through co-lending.
“The Reserve Bank of India's innovation in payments with UPI has been incredible. Similarly, one of its most notable innovations in lending has been co-lending, which has resulted in a notable shift in the ecosystem. To fully leverage this model, it's essential to address the issue of credit access for MSMEs. The solution to this problem lies in making debt accessible to all businesses through technology. It brings me great pleasure to collaborate with Lendingkart, as our combined scale and technological capabilities have the potential to unlock Rs 1000 crore worth of credit over the next year,” said Gaurav Kumar, founder and chief executive officer (CEO) of Yubi.
“I’ve always believed that a collaborative approach will enable us to better serve the unbanked and drive greater efficiencies and opportunities. Lendingkart and Yubi have been the cornerstones of digital lending for the last few years in terms of product and tech innovations – and in the process, built platforms that complement each other perfectly. With this partnership and integration of Yubi Co.Lend & Lendingkart 2gthr, I strongly believe our combined capabilities in leveraging technology and data will truly make a difference in providing access to finance to those who need it the most,” added Harvardhan Lunia, co-founder and chief executive officer (CEO) of Lendingkart.