Latest Trends in the Financial Industry

Buy Now Pay Later (BNPL): India has about 100 million people who like to shop online and amongst them, only 25 million people own credit cards. This is because the Indian population consists of millennials and Gen Z who enjoy fast; seamless experiences and are card averse. So, the BNPL payment mode which is available at low cost or no cost EMI’s enables affordability especially in circumstances like big-ticket purchases. Job losses, salary cuts, and other factors have also contributed to the upswing of the BNPL mode of payment. To create a digital lending eco-system and to allow people with no credit history to avail credit, such platforms are being introduced.

Co-origination Of Loans: To address the credit gap, RBI has facilitated the co-origination of loans model which involves banks, fintechs, and NBFCs forming a partnership with each other to finance loans and undertake credit risks jointly. To finance the priority sector, financial institutions have engaged in the co‑origination of loans and several other institutes have adopted the same to finance small-ticket consumer loans. With the help of alternative data sources like social media profiles, purchase history, utility, and other bill payments – banks are utilizing this model to gauge a customer’s creditworthiness with no credit history.