siliconindia | | SEPTEMBER 20258For decades, getting a loan in India was like walking into a fortress that needed a spotless credit score to get past the gates. But what about the millions who never got the chance to build one? Think of gig workers juggling delivery shifts, young professionals just stepping into the workforce, or first-time borrowers dreaming of their own homes. Traditional banks rarely looked their way. That's where India's fintech revolution has begun rewriting the rules.Today, nearly a billion Indians still lack formal credit access so lenders are deploying mobile-first, data-driven tools to bridge this gap.For example, platform-driven loan apps use real-time bank and payment data to underwrite small, unsecured loans to ride-hail drivers and delivery couriers. By leveraging digital identity systems (like Aadhaar e-KYC) and online transaction records, these lenders can serve a new generation of creditworthy customers. As one expert notes, fintechs are clearly serving an unmet need for credit that traditional banks have not satisfied.Saroj Topno Mittra, Director, Margdarshak, says, "Digital solutions and new technologies also offer great potential to overcome the hurdles of balanced socioeconomic development. With two-thirds of the world's population now connected to mobile devices, the digital channel is opening up new opportunities to reach unserved and underserved markets more quickly and efficiently".The New Face of LendingAlternative Credit ScoringFintech lenders use nontraditional data to rate borrowers. Instead of relying solely on CIBIL scores and paperwork, they analyze bank statements, GST filings, UPI and mobile wallet transactions, e-Commerce histories, social media profiles, and even smartphone usage patterns. Machine learning algorithms ingest tens of thousands of data points to create a profile of repayment ability.For instance, one AI-based underwriting platform evaluates a user's digital footprint from bank balance trends to Facebook/LinkedIn activity to approve or reject a loan in minutes. These systems can spot subtle patterns (spending cycles, cash inflows) that indicate financial stability, making it possible to lend to `thin-file' customers with little or no credit history.Apps Over BranchesNearly all new lenders are smartphone apps designed for easy use. Borrowers can apply via a mobile app or website, complete e-KYC (often through Aadhaar OTP or video calls), and get instant sanction. Apps like EarlySalary, KreditBee, and others offer fully digital onboarding and rapid disbursal of small personal loans. By contrast, traditional banks would take days of paperwork and verification. These platforms often partner with banks or NBFCs in the backend.For example, the mobile wallet-based platform Dhani (by Indiabulls) disburses Rs 1,000-Rs 50,000 loans via its app. In one year it gave loans to over 3.5 million first-time borrowers.The Phone as a BankThe India Stack of digital infrastructure Aadhaar for identity, DigiLocker for documents, and the Account Aggregator (AA) framework enables remote onboarding. Lenders use Aadhaar's e-KYC service to verify customers instantly via fingerprint or OTP, reducing paperwork. New RBI guidelines EDITORIAL EXCLUSIVEUNLOCKING CREDIT FOR INDIA'S UNDERBANKED THROUGH DIGITAL INNOVATIONUNVEILING THE DUAL REALITIES OF DARK WEBSITES IN THE DIGITAL AGE· Fintech expands credit access to underbanked Indians· AI and India Stack enable instant digital loan approvals· Scams, AI bias, and RBI rules require careful oversightBy M R Yuvatha, Senior Correspondent, siliconindia
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