DIGITAL LENDING - A WAY FORWARD

Digital lending is the process of availing credit online. Its increased popularity amongst new-age lenders can be attributed to expanding smart phone penetration, credit range flexibility, and speedy online transactions. In the last few years, India has seen a massive disruption in the fin-tech space that has brought flexibility and the versatile digital customer experience in banking and lending. Additionally, the outbreak of COVID-19 has created a huge space for consumers and business enterprises to heighten the lending market growth. Digital lending has a larger opportunity in India and the total retail loan which could be distributed digitally till 2023 would be over $1 trillion. According to research work of Boston Consulting Group on consumer behaviour across purchase journey, 50% of loan seekers with internet access buy their loans online.

- J. Rajesh Kumar

Digital Lending in India 
In India, unmet credit demand of younger cohorts, low financial inclusion, technological advancements and increasing internet penetration are going to be the strong drivers. However, trust in technology, data security and customer protection considerations will play a critical role in determining the extent of Fin-Tech adoption.

India's vision towards becoming a cash-light economy combined with the growth of public digital infrastructure and the demand for financial inclusiveness makes it a front runner in the digital lending technology arena. Data analysis indicates that digital lending is set to account for 60% of the total Indian fintech market by 2030 (Mukesh Chand. 2022).

India's digital lending market has grown quickly and facilitated $2.2 billion in digital loans in 2021-22. The digital lending market size is set to grow from USD 270 billion in 2022 at a CAGR of 22% between 2022 and 2030 ( Inc42 Report, 2022).

Digital ecosystem
Along with customers' behaviour, it is very essential to have favourable digital ecosystem for the development of digital lending. India has pioneered in creating conducive ecosystem for development of Fin-Techs and digital transactions.