Under this partnership, IIFL Home Finance Ltd and the Standard Chartered Bank will co-originate these loans and the IIFL Home Finance Ltd will service the customers

Fairfax and CDC-backed IIFL Finance on Tuesday said its wholly-owned subsidiary IIFL Home FinanceLtd and Standard Chartered Bank have entered into a co-lending arrangement for extending MSME loans.

Under this partnership, IIFL Home Finance Ltd and the Standard Chartered Bank will co-originate these loans and the IIFL Home Finance Ltd will service the customers through the entire loan life-cycle including sourcing, documentation, collection and loan servicing, IIFL Finance said in a regulatory filing.

“We believe this is one of the first co-lending partnerships after the RBI’s revised guidelines,” Monu Ratra, the CEO of IIFL Home Finance, said.

IIFL Home Finance in December partnered with ICICI Bank to provide affordable housing and MSME loans as a sourcing partner. In October CSB Bank had also partnered with IIFL Finance for sourcing and managing retail gold loan assets.

IIFL Finance is a retail-oriented non-banking finance companies (NBFC) with about 90 per cent of its Rs 41,000 crore loan book under the retail category.

In November last year, the Reserve Bank had came out with a Co-Lending Model (CLM) scheme under which banks can provide loans along with NBFCs to priority sector borrowers based on a prior agreement.

The CLM, an improvement over the co-origination of loan scheme announced by the RBI in September 2018, seeks to provide greater flexibility to the lending institutions.

Source: PTI

(The story has been published from a wire feed without modifications to the text. Only the heading has been changed)

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