Bank of Maharashtra (BoM) has entered into a strategic co-lending agreement for MSME (micro, small and medium enterprise) loans with LoanTap Credit Products Pvt Ltd, a Pune-based non-banking finance company.
The co-lending model provides ease of loan sanctions at borrower’s convenience through digital lending platforms, the Pune-headquartered public sector bank said in a statement.
Digital lending covers end-to-end loan processing cycle without manual intervention, from on-boarding of customers to loan disbursement and monitoring.
Under the co-lending model, the bank will have an exposure of up to 80 per cent to an MSME customer. LoanTap will take the balance exposure.
AS Rajeev, Managing Director and CEO, BoM, said the co-lending arrangement will enhance credit flow to the unserved and underserved sectors and make available funds to the ultimate beneficiary at an affordable cost.
Hemant Tamta, Executive Director, BoM, said that the co-lending model will help the bank to meet the priority sector lending target. It will be beneficial for all – NBFCs having wider outreach and customers – who will be facilitated with low-cost credit from banks.