Nilekani opens credit infra to aid small biz
BENGALURU/NEWDELHI:A major new technological innovation is in the works connecting lenders with the marketplace, Aadhaar architect Nandan Nilekani announced on Wednesday, as he buttressed the need for India to “democratise credit” for millions of small businesses to revive its virus-battered economy.
Speaking at the Global Fintech Festival, 2020 on Wednesday, Nilekani, co-founder and non-executive chairman of Infosys Ltd, described the initiative as a credit protocol infrastructure called the Open Credit Enablement Network or OCEN, built by the Indian Software Product Industry Roundtable (ispirt), a thinktank of the software industry.
Under these new credit rails, OCEN will act as a common language, connecting lenders and marketplaces to utilise and create innovative financial credit products at scale. Aggregators will be using this programming interface to embed credit offerings in their applications , which in turn will play a crucial role in democratising access to credit and lowering interest rates for borrowers. ispirt is partnering with the State Bank of India, Bank Ltd, ICICI Bank Ltd, IDFC First Bank Ltd, Axis Bank Ltd and Bajaj Finserv Ltd for this new credit rail.
“Apart from the digitisation of the lending process, we have data stores through the Account Aggregator (AA) network, and for credit to move seamlessly to small businesses, lenders will need to have a common protocol. Just like what UPI did with payments,” Nilekani said. “We are working on a common language for lenders and borrowers, called the Open Credit Enablement Network protocol, which will have a dramatic impact to enable small businesses to get loans.”