RazorpayX launched RazorpayX Digital Lending 2.0 that will help in automating direct disbursals and repayments between the borrower’s and the regulated entity’s account. The new launch comes as the RBI's deadline of November 30 is approaching near.
The business banking platform of Razorpay has launched RazorpayX Digital Lending 2.0, a complete digital lending solution for NBFCs and fintechs in adherence with the new digital lending guidelines issued by the Reserve Bank of India (RBI).
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The new RazorpayX will help automate direct disbursals and repayments between the borrower’s and the regulated entity’s accounts, making it easier for NBFCs and fintechs to work together.
Until now, NBFCs transferred the money into a third-party pool or fintech accounts, from where the funds were disbursed to borrowers. However, after the latest guidelines, transferring money via a pass-through account or pool account of any third party is no longer compliant.
To help NBFCs and their associated Digital Lending Apps (DLAs) and Loan Service Providers (LSPs), the new platform will provide a full-stack lending suite that enables these lenders to - automate direct money transfers between the lenders' and borrowers' accounts. The company also claims that users can manage multiple fintech partners using a single current account.
Razorpay further claimed that its new solution would enable co-lending models and involve multiple lending partners by automating the splitting processes of the repayment amounts and disbursals from a single account to borrowers.
"With RBI’s deadline making it mandatory for businesses to move to newer and compliant processes by 30th November 2022, it was essential for us to take into account the needs of our customers and come up with a solution that can help them transition into the future of digital lending with utmost ease and confidence,” Rahul Kothari, Chief Business Officer, Razorpay said,
The new digital lending guidelines announced by the RBI have made it mandatory that loan disbursals and repayments happen directly between the accounts of regulated lenders (NBFCs or banks) and borrowers. This has made many lending merchants rethink their payment infrastructure and figure out a new way to transfer money to their borrowers without any pass-through account or pool account of any third party or fintechs.
RazorpayX currently serves over 30,000 businesses and claims to process transactions for over 20 percent of all UPI-registered users in India.
The company's Payouts platform has seen over 200 percent growth in its business and across its other products such as Neo-Banking, Vendor Payments, Payroll and Corporate Credit Cards.
The digital lending market in India is currently valued at $270 billion and is expected to increase to $1.3 trillion by 2030.
First Published: IST