Beginning in January 2026, a PSB alliance digital platform for lending to small businesses will go live at scale, offering up a new route for MSME financing.
Key Highlights
- PSB Alliance and Veefin launch a cloud-based digital lending platform for MSMEs to access credit.
- The unified platform could help PSBs close the estimated ₹20-25 trillion MSME credit gap.
The platform will enable any fintech or entity that supports MSMEs, including dealers, to integrate and provide a finance interface for small enterprises. On the other end, 12 public-sector banks will make digital loans to these businesses.
Sorabh Dhawan, CEO of PSB Xchange, said the platform aims to disburse Rs 3 lakh crore of loans by 2030.
PSB Xchange is a multi-lender system that connects corporates and channel partners with banks, non-bank financial institutions, and fintechs. "Developed by PSB Alliance in collaboration with Veefin Solutions, it enables digital credit delivery throughout the country. This is the first time India's major lenders have collaborated on a common platform to assist MSMEs," Dhawan explained.
"I spent the most of my 18-year banking career underwriting and financing MSMEs, so I've witnessed firsthand the segment's strength and promise. Supply chain financing can unlock that potential on a large scale, and I believe PSB Xchange will play a critical role in altering access to working cash," he said.
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He stated that just 14-15% of MSMEs now have access to formal finance. "Our goal is to broaden this coverage while making credit available at low prices. By bringing together fintechs, corporates, dealers, distributors, suppliers, and lenders on a single platform, we ensure that MSMEs may access cash at rates below 10% rather than relying on high-cost credit," he said.
Dhawan stated that the platform has over 70 active sourcing partners and can be utilized by nearly 9,900 fintechs in the country without requiring unique integration with each bank.
