- PSBloansin59minutes.com which was launched by Prime Minister Narendra Modi in 2018 has emerged as the country’s largest online lending platform, with loan sanctions exceeding over Rs 35,000 crore.
- The portal provides credit up to Rs 1 crore to micro, small and medium enterprises (MSMEs) in just 59 minutes or less than an hour.
- The portal was launched in November to provide credit of up to Rs 1 crore to micro, small and medium enterprises (MSMEs) in just 59 minutes or less than an hour, in a bid to make banking transparent and hassle-free.
- The platform, designed under the guidance of Financial Services Secretary, Rajiv Kumar, has reduced the turnaround time from 20-25 days to 59 minutes. Upon approval, the loan is disbursed in 7-8 working days.
- the automated loan processing system has not only brought in ease, but is also helping in fostering transparency.
- It has put an end to discretion at the bankers’ end, as in-principle approval of loans does not require human intervention
- Due to the linking of data points, no one can game the system now. There is no scope for information asymmetry.
- 1.62 lakh MSME units have been given in-principle approvals, while 1.12 lakh have got a final nod.
- MSME units availing of the loans have to submit details such as income-tax returns, GST data and bank statements to avail of credit facility through this portal.
- The quantum of loan processing through this portal is much larger than the Rs 6,500 crore of cumulative disbursements by two of the largest online SME lending NBFCs over the past three years, adding that the average ticket size (ATS) for new borrowers is Rs 27 lakh and Rs 34 lakh for repeat borrowers.
How to Works?
- Through the Portal, the MSMEs apply for a loan using their GST registration as the portal is integrated with GST server at the back-end as well as IT, credit bureaus and banks.
- The portal then quickly scores the applicant on individual models of lenders.
- Borrowers then select the lender and branch which is willing to grant “in-principle” approval.
- The approval is then presented to the branch selected along with necessary documents. The loan is then
- Since the portal links data points, no one can game the system as there is no scope for information asymmetry.