Cashfree Payments, India’s payments and API banking solutions company, launched ‘Co-lend’, a fully automated escrow management solution for co-lending.
‘Co-lend’ has been developed in line “with the digital lending guidelines announced by the Reserve Bank of India (RBI).” It facilitates instant disbursal “with auto reconciliation and a dashboard for managing multiple partnerships.” Additionally, it requires “no manual intervention, automatically notifies the loan management system, and eliminates reconciliation efforts.”
Currently, in co-lending partnerships, “the reconciliation of funding to the escrow accounts for disbursement and repayments is done manually, resulting in errors and delays.”
The lender and originator “pool money into the Co-lend escrow, and then disbursals and collections happen from and into the escrow.”
In this process, the Loan Management System (LMS), the Loan Origination System (LOS), and the actual loan disbursal as well as repayment “are disconnected, resulting in reporting delays and challenges in accounting and reconciliation for each player in the partnership.”
Cashfree Payments’ ‘Co-lend’ “addresses all these challenges and makes the entire process automated, increasing efficiency and accuracy.”
Cashfree Payments’ ‘Co-lend’ “provides a robust platform for co-lending originators and lenders, especially the ones sanctioning high volumes of loans, where real-time disbursement, repayment and reconciliation are primary requirements.”
Cashfree Payments has also partnered “with Loan Management Service and Loan Origination Service providers as well as banks to enable a plug-n-play offering for lenders to manage all their co-lending and add new partners with ease.”
The current set of banks that already “support a Co-lend integration are ICICI Bank, Kotak Mahindra Bank, Yes Bank, IndusInd Bank, and Axis Bank.”
Akash Sinha, Co-founder and CEO of Cashfree Payments, said:
“With the exponential expansion in digital lending, there is a tremendous demand for compliant and scalable solutions. We are pleased to announce that Cashfree Payments now offers a co-lending platform to provide NBFCs and banks with a one-stop solution for escrow management, disbursal and repayment, with a focus on automating payments and complex reconciliation involved. As an innovator in the API banking and payments space, we have strived to deliver this solution at a vital juncture to assure continuity and development for our merchants while maintaining compliance at the forefront.”
With over 50% market share among payment processors, Cashfree Payments claims it “leads the way in bulk disbursals in India with its product Payouts.”
Recently, India’s largest lender, SBI reportedly “invested in Cashfree Payments, underscoring the company’s role in building a robust payments ecosystem.”
The company works closely “with all leading banks to build the core payments and banking infrastructure that powers the company’s products and is also integrated with major platforms such as Shopify, Wix, Paypal, Amazon Pay, Paytm and Google Pay.”
Apart from India, Cashfree Payments’ products are “used in eight other countries including the USA, Canada and UAE.”