IIFL and FinBox bagged Sahamati’s award for MSME lending through Account Aggregator

IIFL and FinBox

May 24, 2023: Digital infrastructure company FinBox and the NBFC IIFL Finance have been awarded for their work in building a cash flow and GST data-based unsecured business loan product for MSMEs at SamvAAd – an Account Aggregator (AA) community event.

The event, hosted by Sahamati, the self-regulating entity for the AA ecosystem, saw participation from leading banks, FinTechs, and other ecosystem partners. As part of this competition, FinBox and IIFL’s digital lending product that enables seamless underwriting through AA was adjudged to be among the best.

FinBox and IIFL have been working together since 2021 when the former enabled end-to-end digitisation for the NBFC lending products. Soon after the launch of AA in September 2021, FinBox became one of the first FinTechs to go live with the framework in collaboration with Finvu. And today, it’s helping IIFL underwrite business loans through AA and GST data.

Through its integration, FinBox enables IIFL’s business loan applicants to share their banking, financials, and other data such as GST details in just a few simple steps, enabling more comprehensive underwriting on data points such as sales volumes, profit/loss, and vintage. FinBox BankConnect(integrated with AA) helps lenders bring down the cost of these loans by up to 60%, thus enabling small-ticket and short-tenure loans.

“The launch of the AA framework was a major step towards flexible lending to MSMEs, offering them a quicker and more efficient channel for data-sharing with lenders. As a FinTech geared towards incentivizing financial inclusion with technology, we’re excited to be working with one of India’s leading lenders to streamline business loan underwriting and bank statement data and analytics through AA – and this award serves as encouragement for us to push further,” said Rajat Deshpande, CEO and co-founder of FinBox.

Mehekka Oberoi, Strategy Lead, CEO’s office at IIFL said: “Our business loan journey has seen an improvement across the board – the process has become much more convenient for our customers. Today close to 15-20% of our customers are using this flow.

The analytics on top of the AA data provided by FinBox has helped improve underwriting precision as well. Account Aggregator has truly been a game-changer for the industry and with GST data coming in, there would be more innovative products that would be built around that. The progress of the account aggregator ecosystem has been significant and it would drive the future of data in the financial services ecosystem.”

“Income verification and bank statement analysis is a key aspect of underwriting business loans but sees high drop-offs at the upload stage. And we’re thrilled that our combined efforts have eased such roadblocks and enabled IIFL to improve its bank statement analysis and boost business loan approvals to an underserved yet deserving segment,” said Manoj Alandkar, Co-founder, FinVu.

SamVaad 2023 invited nominations from Account Aggregators and Technology Service Providers, showcasing their work in categories including long and short-term credit, insurance, banking, etc, across customer cohorts such as HNIs, SMEs, and salaried citizens. The event saw participation from 300+ Financial Institutions across the four Financial Sector Regulators and the TSP community.

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