Borrowing money from banks or finance companies involves submitting job details, personal information, land documents, and other necessary paperwork. Verifying and processing the loan often takes several days.
To address this issue, the Reserve Bank of India (RBI) is introducing a new tech platform called Unified Lending Interface (ULI) to simplify the loan process. RBI Governor Shaktikanta Das announced this initiative during a conference in Bangalore.
Similar to the revolutionary impact of the Unified Payments Interface (UPI) on digital payments, ULI is expected to bring about significant changes in loan disbursement.
Based on a successful pilot project called Frictionless Credit, ULI is designed to reduce loan sanctioning time and streamline the lending process significantly.
This technology platform prioritizes data privacy and simplifies the complexity of integrating multiple technologies.
Shaktikanta Das emphasized that ULI will particularly benefit small loan borrowers, and it is likely to be especially advantageous for Micro, Small, and Medium Enterprises (MSMEs) and farmers, opening up new possibilities for growth.
Once officially launched, ULI will provide lenders with access to land records and enable quick loan approvals. The platform, designed with a user-friendly interface, has been developed to facilitate a straightforward loan process, especially for those seeking small loans.
How does ULI work?
It is well known that the introduction of UPI has significantly changed cash payments. Once again, RBI is prepared to introduce revolutionary changes.
Preparations have begun for quick loan approvals through the Unified Lending Interface (ULI). This system will be available in a few days. But how does ULI work? Let’s find out.
ULI operates based on land records and other vital digital information, making the loan approval process more accessible.
Developed with standard APIs, ULI follows a “plug-and-play” approach, enabling information to be obtained from various digital sources. This information can then be used to analyze users’ financial and non-financial data.
This simplifies the loan application and approval process, making it faster. Additionally, it allows for loans without extensive documentation, providing benefits to rural individuals and those seeking smaller loan amounts.