Digital lending may pip traditional lending on unsecured loans by 2030

February 14, 2023

New Delhi, Feb 14 (IANS) The fintech revolution is likely to spur digital lending in India, which is expected to surpass traditional avenues of lending by 2030, a report showed on Tuesday.

This will be driven by unsecured small-ticket size segment and the secured collateral-based high-ticket size market, according to the latest white paper by Experian India in collaboration with the Digital Lending Association of India (DLAI).

As co-lending becomes the predominant operating model in India, more traditional lenders will collaborate with fintechs to reach a higher degree of maturity and amalgamation of core competencies.

Open data will create level-playing field for fintech and traditional lenders, according to the white paper.

“Traditional lenders have always dominated asset-backed lending. With increased digitisation, this segment may become accessible to fintech lenders, allowing them to capture a sizeable portion of the lending pie,” said Saikrishnan Srinivasan, Managing Director, Experian Credit Information Company of India.

The research highlighted that the next 100 million customers are likely to have a vastly different profile and expectations than those currently in place.

For MSME borrowers seeking business loans, those with credit scores higher than 700 are catered to more by fintechs than by other lenders, paving the way for the co-lending model to flourish.

“With the release of this whitepaper, we are excited to offer a comprehensive look into the impact of fintech-led digital lending in India,” said Siddharth Mahanot, Chairperson-Knowledge Committee, DLAI.



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