Axis Bank, India’s third largest private sector bank, and Shriram Housing Finance Ltd (SHFL), a premier Affordable Housing Financing Company, established a strategic relationship today via the Yubi Co.Lend platform under the co-lending model. Under this collaboration, both lenders will provide secured MSME (Micro, Small and Medium Businesses) Loans and Housing Loans to moderate and low-income borrowers in rural and semi-urban areas.
The cooperation will use Axis Bank‘s substantial financial experience and SHFL’s loan processing technology to assess borrowers’ credit profiles and supply them with loans at low interest rates through SHFL’s network of 123 branches. This collaboration will cater to potential clients who are either new to credit or are underserved by larger institutions, and will help to create a secured loan book. The alliance will use the Yubi tech platform to process loans in accordance with the co-lending rules.
Speaking on the collaboration, Munish Sharda, Group Executive & Head – Bharat Banking, Axis Bank, said, ”The partnership with SHFL is aligned with the Bank’s Bharat Banking mission of driving financial inclusion in the rural and semi-urban regions in a seamless digital manner. This alliance will improve our reach, strengthen our presence in the MSME and affordable home loans segment, and augment the priority sector lending portfolio of the Bank. We are excited to grow the partnership using our digital co-lending platform and offer a superior customer experience.”
Commenting on the partnership, Ravi Subramanian MD & CEO, Shriram Housing Finance Limited said, “The Axis-SHFL partnership is a powerful combination. Together we will expand our reach and serve a much larger customer base for Housing and secured MSME loans, specifically targeting borrowers at the bottom of the pyramid. Through the co-lending model, we intend to channelize credit to the priority sector as we step up lending in a credit-starved economy. The co-lending model has the potential to catalyse the resurgence of India’s MSME sector and transform the priority sector and today’s announcement is yet another step in this direction.”
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The combination of two lenders intends to serve consumers in the unorganised sector, such as self-employed or salaried borrowers who have limited access to credit due to a lack of adequate income evidence. Axis Bank and SHFL will address the credit gap faced by MSMEs and house loan borrowers by combining their expertise, using their enormous customer reach and rigorous credit underwriting and assessment technologies. With over 123,000 consumers served to date, the cooperation with Axis Bank demonstrates SHFL’s commitment to the affordable housing financing area.
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