Pilot project for public tech platform for frictionless credit to start today: How will it work, key benefits and more

The platform will also enable linkage with services such as Aadhaar e-KYC, land records from onboarded State Governments (Madhya Pradesh, Tamil Nadu, Karnataka, Uttar Pradesh, and Maharashtra), Satellite data, PAN Validation, Transliteration, Aadhaar e-signing, account aggregation by Account Aggregators (AAs), milk pouring data from select dairy co-operatives, house/property search data etc., the central bank said.

As of now, India didn't have an inclusive and well-developed digital public infrastructure to bring all stakeholders together. For digital credit delivery, the data required for credit appraisal are available with different entities like Central and State governments, account aggregators, banks, credit information companies, digital identity authorities, etc. However, they are in separate systems, creating hindrances in the frictionless and timely delivery of rule-based lending.

So, India has embraced the concept of digital public infrastructure which encourages banks, NBFCs, fintech companies and startups to create and provide innovative solutions in payments, credit, and other financial activities with rapid progress in digitalisation, according to RBI.

Calling the move a positive step, Anil Pinapala, Founder & CEO at Flexpay by Vivifi, said he is optimistic about the expansion of the project beyond the initial phase.

"The platform is uniting disparate pieces of digital data from across the ecosystem into a cohesive, unified view. By integrating banking, credit, and even corporate and governmental information, it facilitates swift and dependable underwriting which will, in turn, extend credit accessibility to segments of the population that were previously underserved," Pinapala told CNBC-TV18.com.

"This aligns well with our government's vision of establishing a digital public infrastructure, which empowers banks, NBFCs, Fintech enterprises, and Startups to devise and deliver innovative solutions in payment, credit, and other financial domains," he said.

Echoing similar views, Karthikeyan K, Co-founder and CTO at KreditBee, said that the public tech platform would facilitate a smooth flow of necessary digital information to lenders, enabling the supply of 'frictionless finance'. It will make the lending process more efficient by lowering costs, enabling faster distribution, and improving scalability.