The trifecta needed to shape the
current Indian credit market
Gaurav Kumar
CEO and Founder of Yubi
Inthe curTent global macro
| enmvironment, India has been
Ta beacon of light. After 5
years of making in India, sup-
ply chain reorganization post-
Covid, strong consumption,
and intrastructure invest-
ments, we are poised to leap-
frog over the next decade.
In order for our econonmy to
grow,creditgrowth willbe key.
Our Debt to GDP is around
86%, compared to 120-130%
in other developed countries
Financial deepeningand rising
debtneed togo hand-in-hand
forimprovementsin economic
well-being. A healthy level of
debt ensures money is lent,
invested, spent, and paid back
to further accelerate the
growth of businesses. Debt
allows businesses to invest
even when their sales would
otherwise not allow them to.
Having the ability to borrow
allows fiscalauthorities to sta-
bilize the macroeconomy.
But whendoes debt actually
become beneficial? When it is
accessible, available in a cost
effective manner that's easy to
use. If there are barriers to
debt,economies will stagmate.
The Regulator has played an
instrumental role in re-cali-
brating theecosystem between
Banks, NBFCs, and Fintechs.
A number of guidelines, stuch
as the Digital Lending guide
lines, provide direction on how
everyone in the credit ecosys
tem might coexist and what
their roles should be. The
emergence of co-lending will
be a major driver of credit
access for individuals, enter-
prises, SMEs, and agriculture
in the next decade.
It is essential, however, to
discover an effective method
based on the trifecta that can
strengthen the Indian credit
market.
Network: A network is
Digital Banking
Infrastructure
End to end offering in your
debt deployment life cycle
(sourcing to collections
A pictorial representation of the trifecta we hqve created at Yubi (www.go-yubi.com)
essentially the outcome of
bringing together multiple
ecosystemplayers on oneplat-
form so they can share collec
tive benefits while providing
the end-user with choice and
accessibility. With the rise of
online marketplaces, multiple-
industries have reaped this
benefit, but this has ehuded the
credit ecosystem. Bringing
all the parties on a single plat-
form removes the barrier of
physical boundaries
to securing credit
and also signifi-
cantly reduces the
cost of finding the
right partner.Thisll
ensure promising
borrowers find the
right lenders to
meet their capital
needs on time, with the lowest
overall cost of transaction.
Protocol: Once the net
workoflenders and borrowers
is established on a unified
platform, it's essential to help
them communicate. The pro
tocol layer establishes a direct
line of communication
between the two of them to
share their preferences, and
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Solving for spood and
Protocols
efficiericy
Extendabia integratios,
reduced time to markst for
additionaB products
parameters with each other infrastructure layer can seam-
and source vital information lessly enable a frictionless flow
to fairly evaluate each other. of credit in our economy.
For India's debt market to At Yubi, were building this
grow, APls (application pro- trifecta of network. protocol,
gramming interfaces) are and digital banking infrastruc-
essential to resolving the ture to reshape India's credit
issues of information asym- landscape. This will bring
metry and red tape. affordability by lowering dis-
Digital Banking covery costs, efficiency by
Infrastructure: The final eliminating manual underwrit-
piece ofthe puzzle is the avail- ing and offline processes, and
ability of appropriately pack ultimately increase accessibility
aged financial prod- to raise capital for an exponen-
ucts to meet the tially large pool of borrowers
mint needs of everybor in need. In particular, we will
rower, based on the beable to deepen India's credit
Brand stageofthe
lifecycle market and propel capital in
Studio they're at. There is
no one-size-fits-all
therightdirectionbyaccelerat-
ing the movement of capital to
when it comes to the priority sector. Credit has
Yubi For the the power to truly unlock
finance.
network to be human potential, to transformn
meaningfully utilized, the dreamsinto reality, to helpseize
right financial product needs opportunities, and foster the
to be made available to the spirit ofinnovation, all ofwhich
right people, in a secure yet exist in abundance in India
scalable fashion that reaches today. Unlocking access to
the last mile. Whilethis bank credit for all and ensuring opti-
ing infrastructure is in place maldistributioncan helpIndia
already, it's plagued by ineffi be on the right track to realize
ciencies like manual paper- a $5 Trillion economny.
work and long drawn pro-
cesses. With technology, this Created by Mint Brand Studio