PSBloansin59minutes.com is now India’s largest ‘online lending platform’

Bengaluru: PSBLoansin59minutes.com, a portal that was launched three months ago to facilitate loans for medium and small scale industries, has become the largest "online lending platform" in India, according to a Credit Suisse report. The online loan approval platform connects state-run banks with small and medium enterprises (SMEs). While public sector banks still struggle with low profits and bad loans, the platform has "approved" loans worth over Rs 30,000 crore since the November launch, the report said.

Additionally, over Rs 6,400 crore is estimated to have been "sanctioned" through the platform to approximately 24,000 SMEs, while banks have provided in-principle approval to close to 40,000 enterprises, according to the report.

Offline procedure not smooth

Although many industry experts and executives say that the second half of the process gets stuck since it is an offline procedure. While the "in-principle" approval is the first step, the next procedure includes visiting a branch, providing physical documentation and regular appraisal by bankers.

Also, these numbers would include existing SME loans processed by the banks and routed through the platform, which is a large number because of the sheer size and coverage of these lenders.

The report also says that sanction rates have grown from 36 percent at the start to 60 percent while "turnaround time" has reduced from over a month to a week presently. The time taken for the approval of new borrowers is more as approval rates are also lower, although existing borrowers have a close to 100 percent approval.

"PSB59 leverages the growing digital data footprint," said the India Banks Sector report by Credit Suisse. "SMEs apply for loans using their GST (goods and services tax) registration as the portal is integrated with the GST server at the back end as well as IT, credit bureaus and banks."

21 PSU banks connected

PSBLoansin59minutes.com connects with 21 state-owned banks, including Bank of Baroda, Bank of India and State Bank of India.