Decoding Federal Bank’s bet on full-stack lending play

Decoding Federal Bank’s bet on full-stack lending play

author-image

Pratik Bhakta

174 reads
author-image

Pratik Bhakta

174 reads

In a role reversal, the Kochi-based lender has built a full-stack API platform, which fintechs and NBFCs can use to run their online credit business. It is pitching the solutions on a debt marketplace as well as directly to NBFCs

November 17, 2022

8 MINS READ

For the past four years, the story in financial services has been all about the relentless rise of fintechs. And how it has shaken old-fashioned Indian banks, which must keep up with the times or risk losing more customers.

Nowhere has this upheaval been more visible than in the credit business, which is packed with new companies signing up would-be borrowers at a record pace.

But some banks are now flipping the script. Instead of just following such companies’ example, they are trying to take the lead in building comprehensive tech for lending and inviting players in the space to tap it. The players could be traditional non-banking financial companies, or NBFCs, and even fintechs with a virtual storefront but no back-end functionalities to process loan applications.

Kochi-headquartered Federal Bank has created a full-stack API platform that others can use to serve borrowers. Broadly, this is software that carries out a number of processes necessary for loan disbursals, from client verification to underwriting. 

The CapTable understands that Federal plans to pitch ‘Digital Credit 1.0.0’, currently in the testing phase, on debt marketplaces and directly to potential co-lending partners. 

share

Share this read

bookmarklike
like
bookmark
share
share-button
like-button
share-button

For subscribers only

Premium Reads

>>

View More >>

Deeply reported and objective news on the country´s fastest-growing companies and the people behind them.