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Reserve Bank unveils UPI-like platform for lending
The platform reduces the time for credit assessment, particularly for small and rural borrowers, Das said, adding that ULI is designed to easily connect with different data sources
The Reserve Bank of India (RBI) is testing the Unified Lending Interface (ULI), an app designed to enable “frictionless credit” and transform India’s lending ecosystem, similar to how the unified payments interface (UPI) revolutionized the payments landscape.
RBI is running a pilot of the technology platform that “facilitates seamless and consent based flow of digital information, including even land records of various states, from multiple data service providers to lenders,” central bank governor Shaktikanta Das said at the RBI@90 global conference on “Digital Public Infrastructure and Emerging Technologies” in Bengaluru.
The platform reduces the time for credit assessment, particularly for small and rural borrowers, Das said, adding that the ULI is designed to easily connect with different sources of data.
“The ULI architecture has common and standardized APIs, designed for a ‘plug and play’ approach to ensure digital access to information from diverse sources. This reduces the complexity of multiple technical integrations,” Das said. APIs, or application programming interfaces, are tools that let different software programs communicate and work together easily.
It enables borrowers to get the benefit of seamless delivery of credit, quicker turnaround time without requiring extensive documentation. In sum, by digitizing access to customer’s financial and non-financial data that otherwise resided in disparate silos, ULI is expected to cater to large unmet demand for credit across sectors, particularly for agricultural and MSME borrowers,” Das said.
“Based on our experience from the pilot project, a nationwide launch of the ULI will be done in due course,” Das said, adding that just like how UPI transformed the payments ecosystem, “we expect that ULI will play a similar role in transforming the lending space in India.”
The ‘new trinity’ of JAM-UPI-ULI will be a revolutionary step forward in India’s digital infrastructure journey, the central bank governor added.
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