Now, as the Open Network crosses more than 12 million monthly transactions in ecommerce, it launches credit—fully digital and paperless loans in just 6 minutes. The new product is integrated with 9 buyer applications, also called Lending Service Providers, and 3 Lenders marking an important milestone in the quest of the ONDC Network to enhance accessibility and efficiency in credit services.
The first offering from that suite was the unsecured credit product designed for use by both salaried and self-employed classes of people. A few of the buyer applications are Easypay, Paisabazaar, Tata Digital, Invoicepe, Cliniq360, Zyapaar, Indipe, Tyreplex, and Paynearby; among lenders are Aditya Birla Finance, DMI Finance, Karnataka bank.
Now, the whole crediting process that weaves together 4 Digital Public Goods to make it possible to provide the loan digitally, without any paperwork, in just 6 minutes: the submission of financial data is through Account Aggregator; KYC via Digilocker/Aadhaar; repaying through eNACH/eMandate, integrated with Aadhaar eSign for agreement signing. This will democratize the world of credit to India’s farthest reaches and parts, which were inaccessible until now.
“This is indeed a major step in democratising access to credit,” said T Koshy, MD & CEO, ONDC. “Integrating multiple digital systems into one process, we are demystifying the experience of borrowing and we are able to bring this accessibility even to the remotest regions less served by credit.”. This innovation does not bring down operational cost on lender- and buyer-application usage only but also expands financial inclusion and permeates growth and opportunity across the country. This is completely in line with the vision of inclusion by ONDC, hereby extending it to financial inclusion”.
The new process in digital lending will provide credit in a seamless and fast manner. Standardization of the process through the ONDC Protocol will bring greater efficiency and reach for both the lender and buyer applications. For the former, once a lender adopts the ONDC Protocol, it is now going to open up multiple distribution points. Similarly, a buyer application having the ONDC Protocol will now get access to multiple lenders with just one integration.
There is a pipeline of strong buyer applications that want to scale this model in digital credit, including Mobikwik, Rupeeboss through Samridh.ai, and lenders such as HDFC Bank, IDFC First Bank, Faircent, Pahal Finance, Fibe, Tata Capital, Kotak Mahindra Bank, Axis Finance, FTCash, and Central Bank of India.
After the rollout of unsecured loans, this will be followed by GST invoice financing loans by the ONDC Network and this shall be launching before the end of September 2024. This would be followed by other products, such as purchase financing for individuals and sole proprietors, working capital lines for partnerships, and private limited companies.
