Small Industries Development Bank of India (SIDBI) on Saturday said that it had inked an agreement with the Digital Lenders’ Association of India (DLAI) to boost the country’s fintech sector. SIDBI and DLAI have signed a memorandum of understanding (MoU) to this effect.

The MoU aims for collaborations with SIDBI to develop standard protocols to expedite the adoption of digital lending partnerships, including alliances between banks and lending service providers (LSPs) and co-lending collaborations, among others, according to a statement.

SIDBI would also provide resource support to eligible DLAI member NBFCs and also explore assignment and securitisation transactions, it added.

“We are happy to work with the industry on other important aspects like standard protocols, customer protection, grievance redressal (sic), among others, to facilitate faster adoption of digital lending,” SIDBI CMD Sivasubramanian Ramann said.

As a part of its business strategy, SIDBI was using digital technology and partnerships to reach out directly to micro enterprises and would explore offering its credit products through the DLAI members, he added.

Under the agreement, SIDBI and DLAI will explore partnerships for its Prayaas Scheme for informal enterprises, co-lending, GST Sahay, Express Loan, green financing and other direct credit schemes.

“This partnership signifies an important step in India’s fintech journey for enhancing their role in financing the MSME sector. Both organisations are committed to leveraging our combined expertise and resources to put the sector on a high growth trajectory with responsible lending with innovation embedded therein,” DLAI CEO Jatinder Handoo said.