SIDBI CMD Released Digital Lenders Association of India’s (DLAI) Industry Code of Conduct
Framework for Driving Faster Digital Adoption for catalysing financial inclusion and Streamline Direct Lending Collaborations for DLAI members
The Digital Lenders Association of India (DLAI) and the Small Industries Development Bank of India (SIDBI) recently announced that they have formally signed an MoU to propel the growth of the fintech sector in the country. Mr. Sivasubramanian Ramann, CMD SIDBI, also released DLAI’s latest version of the Industry Code of Conduct (CoC) document at the UnConclave 2023 organised by DLAI in Goa on September 23, 2023. The event was attended by the top 100 executives of the Indian fintech industry.
The new version of CoC is structured around the RBI’s Digital Lending Guidelines and takes into account important aspects such as Responsible Lending, Transparency, Fair Debt Collection Practices, Data Privacy and Security, Compliance with Regulatory Framework etc.
Speaking at the occasion, Mr. Ramann, said “High growth in Indian Fintech sector has been driven by best in class Public Digital Infrastructure (PDI) and matured policy support from regulator. It’s for the industry to leverage the Digital lending guidelines of RBI to develop responsible lending practices and the code of conduct prepared by DLAI is an important first step in this direction. We are happy to work with the Industry on other important aspects like standard protocols, customer protection, grievance redressal, etc. to facilitate faster adoption of digital lending. As a part of its business strategy SIDBI is using digital technology and partnerships to directly reach out micro enterprises. SIDBI will explore offering its credit products through the DLAI members.”
The MOU with SIDBI, is to establish a framework for collaboration between DLAI, the members of DLAI and SIDBI. Some of the key highlights of the MoU are as follows:
- Collaborations to Boost Digital Adoption: Collaborating with SIDBI to develop standard protocols to expedite the adoption of digital lending partnerships including alliances between Banks and Lending Service Providers (LSPs), Co-lending collaborations, developing model partnership agreements, etc.
- Enhancing Public Good Interventions: SIDBI to consider support to DLAI to recommend significant public good interventions in areas such as client protection, customer Grievance redressal mechanism, financial literacy, research and publications, etc.
- Direct Lending Collaborations: SIDBI will explore partnerships for its “Prayaas” Scheme for informal enterprises, co-lending, GST Sahay, Express loan, green financing, etc and other direct credit schemes SIDBI.
- Providing Liquidity for DLAI members: SIDBI shall provide resource support to eligible DLAI member NBFCs and also explore Assignment and Securitization transactions.
About Small Industries Development Bank of India (SIDBI):
SIDBI is India's principal financial institution in India for promotion, development and financing of Micro, Small, and Medium Enterprises (MSMEs). SIDBI plays a critical role in supporting entrepreneurship, economic growth, and financial inclusion across the nation though various programs like credit guarantee, direct credit, venture capital, digital platforms, government program management, etc.
About Digital Lenders Association of India (DLAI):
DLAI is a prominent industry body representing digital lenders and fintech companies in India. DLAI is dedicated to promoting responsible lending practices, fostering innovation, and advocating for the interests of its member organizations in the digital lending ecosystem.
For media queries related to DLAI: Ms. Nisha Khetan at nisha@cubicpr.com
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