New Delhi: Did you know that small shopkeepers using UPI will now easily be able to avail loan facilities? The Reserve Bank of India (RBI) continuously formulates new regulations that yield significant benefits on a large scale. Now, the RBI plans to utilise UPI transaction data to assess the credit eligibility of small shopkeepers and business owners who do not possess GST registration.
The RBI is currently developing a new system for this purpose. A senior SBI official shared this information on Friday. Speaking at the Global Fintech Summit in Mumbai, SBI Managing Director Ashwini Kumar stated that if a business generates consistent sales, UPI transactions could serve as a proxy for assessing that activity.
GST-registered businesses get credit cards in just 10 minutes
SBI Managing Director Ashwini Kumar explained that they are developing a UPI-based solution for businesses without GST registration, using UPI transactions as an indicator of sales. He further noted that the bank has already addressed the challenge of extending loans to GST-registered businesses.
In such cases, the bank is capable of sanctioning loans within 10 minutes. Over the past 18 months, SBI has disbursed loans worth ₹1 lakh crore by leveraging GST and PAN card data. However, lending to businesses without GST numbers presents challenges, making alternative data sources crucial.
Addressing issues related to UPI payments, Tiwari pointed out that the lending bank does not always have direct access to this specific information; instead, such data often resides with the recipient bank and the third-party payment apps facilitating the transactions.
Relief for small businesses
It is worth noting that SBI Managing Director Ashwini Kumar Tiwari stated that, with the customer’s consent, the bank can assess credit eligibility using models that incorporate data from sources such as UPI payments and telecom companies. He further stated that SBI expects to be able to provide loans to small business owners based on the new data. This will help address the loan-related challenges faced by small business owners.
Loans Worth ₹1 Lakh Crore Disbursed Using GST and PAN Data
Did you know that SBI has disbursed loans worth ₹1 lakh crore over the past 18 months by leveraging GST and PAN data? Challenges arise regarding businesses that do not possess a GST number; in such cases, alternative data sources become crucial. Addressing the issue of UPI payments, Tiwari noted that lending banks do not always have clear information regarding the destination of the funds.
