RBL Bank partners Piramal Finance for co-lending #IndiaFinance

Mumbai: RBL Bank and Piramal Finance have announced a co-lending partnership aimed at offering loans to middle- and low-income borrowers in rural and semi-urban areas. This marks Piramal Finance’s third co-lending collaboration after similar ventures with Axis Bank and Central Bank of India.
RBL Bank, with a network of over 2,000 touchpoints, will combine its financial expertise with Piramal Finance’s technology-driven loan processing system, ‘High Tech + High Touch.’ Piramal Finance, a subsidiary of Piramal Enterprises, operates 508 branches across 13,000 pin codes in 26 states, serving 1.3 million active customers.
The partnership will focus on addressing the credit gap for MSMEs and home loan borrowers, particularly in Tier 2 and Tier 3 markets. Loans will be tailored to meet the needs of underserved borrowers. Jairam Sridharan, managing director of Piramal Finance, said, “We are pleased to announce our co-lending partnership with RBL Bank, a prominent name in India’s financial sector.” He added, “This collaboration is a significant step toward our shared mission of boosting financial inclusion.”
Both entities will use their combined customer reach, underwriting practices, and credit assessment tools to offer competitive interest rates and formal credit access. Sridharan noted, “Together, we are helping customers across Bharat fulfill their aspirations through formal financial support.”
The co-lending model (CLM) initiated by the Reserve Bank of India (RBI) aims to enhance credit flow to underprivileged sectors of the economy by facilitating collaboration between banks and non-banking financial companies (NBFCs). Launched in 2018 and updated in 2020, the model allows banks to leverage their lower cost of funds while NBFCs utilize their extensive reach, particularly in underserved areas. Under this framework, banks and NBFCs share credit risk in an 80:20 ratio, with a minimum of 20% of the loan retained by the NBFC until maturity.
Piramal Finance offers a range of products, including home loans, loans against property, and used car loans, catering to borrowers in metro peripheries and Tier 1, 2, and 3 cities. Its wholesale lending also spans real estate and non-real estate sectors. The partnership aims to maintain rigorous credit evaluation processes to ensure effective lending and expand financial access to underserved markets.