BoM and LoanTap form co-lending platform for MSMEs

The Bank of Maharashtra (BoM) and LoanTap, the city-based fintech and online lending firm have formed a co-lending platform primarily aimed at micro, small and medium-scale enterprises (MSMEs) that will aim to ease the liquidity crisis in non-banking financial companies.

The guidelines for the co-lending model where partners share liquidity and by extension exposure to a particular borrower were laid down late last year by the Reserve Bank of India.

In a statement, AS Rajeev, the managing director of BoM said that the co-lending model could help NBFCs in easing their liquidity crisis, as well as help out both parties to reach out to more beneficiaries.

According to the partners in the project, potential borrowers can access the line of credit through LoanTap’s existing platform on a specialised section. “This is being primarily aimed at helping shopkeepers and small business owners in their working capital requirements, or purchases. Currently, we are offering credit between Rs 50,000 and 3 lakh, but we want to expand it up to Rs 10 lakh in the future,” said Satyam Kumar, the CEO and co-founder of LoanTap.

A senior BoM official said 80 per cent of the business would come to the bank while the rest would go to Loan Tap.