Cashfree Payments Announces Loan Disbursement and Collections Solutions for NBFC and Language Service Providers
Cashfree Payments, an India-based payment and API banking system, has announced a disbursement and collection loan solution for NBFCs and LSPs.
Non-Banking Financial Companies (NBFCs) and their Lending Service Providers (LSPs) would be able to comply with the new digital lending rules through the solution. Cashfree Payments will offer both digital lending and co-lending use cases with this solution.
The Reserve Bank of India has required that all flow of funds related to the disbursement and repayment of loans take place directly between the bank accounts of the lender and the borrower, without transfer or common account of a third party.
The solution provided by Cashless payments facilitates verification of borrower identity and bank account, construction of lender escrows, transparent loan disbursements directly to borrowers, management of various LSP relationships and rapid reconciliation. Refunds via e-NACH and UPI AutoPay are also allowed according to the standards.
According to Cashfree Payments officials, the digital lending and co-lending industries in India have witnessed phenomenal growth due to the country’s high adoption of fintech. Due to this widespread use, there is a growing demand for compliant and scalable solutions for loan disbursements, loan repayments and KYC verification.
Cashfree Payments launched Issuance, an API banking service, in October 2022 to enable businesses to issue prepaid cards and wallets.
Issuance is an API stack for issuing prepaid cards and wallets that can be used for payroll and incentive payouts, customer loyalty programs, and cost management. The system also allows fintechs and platforms to develop co-branded and single-brand, physical and virtual prepaid cards and wallets for their customers, partners and employees.
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According to Cashfree Payments executives, the launch of the issuance solution complements the company’s goal of speeding up payments in India.