New Delhi: The State Bank of India (SBI), India’s largest public sector bank, has expanded its co-lending partnership with Paisalo Digital Limited, a systemically important non-deposit taking NBFC, to include SME loan products. The new co-lending loan agreement was formalised on June 26, 2025, marking a significant extension of their existing collaboration aimed at inclusive credit delivery.
Strengthening a Proven Digital Platform
This agreement builds upon the SBI–Paisalo digital co-lending platform established in 2021, which has already served over 94 lakh customers across 3,565 touchpoints nationwide. The platform provides end-to-end digital services—from loan origination and disbursement to servicing and recovery—ensuring efficiency, transparency, and financial inclusion, particularly across Tier 2, Tier 3 cities and rural areas.
Focus on MSMEs and Priority Sector Lending
The co-lending arrangement is fully aligned with the RBI’s co-lending guidelines dated November 5, 2020, which encourage joint lending by banks and NBFCs to priority sectors, including micro, small and medium enterprises (MSMEs). Under this framework, SBI and Paisalo will jointly fund SME loans, enabling wider access to formal credit for India’s growing base of small businesses.
Shared Vision for Credit Inclusion
Commenting on the development, Mr. Santanu Agarwal, Deputy Managing Director, Paisalo Digital Limited, said:
“This new agreement with SBI underlines our shared vision to expand affordable and timely credit access to the backbone of the Indian economy. By leveraging our integrated physical and digital approach and SBI’s robust banking infrastructure, we are positioned to scale our impact, drive entrepreneurship, and contribute meaningfully to employment generation across the country.”
Implications and Future Growth
With MSMEs being central to India’s economic fabric, this partnership is expected to significantly catalyse credit flow, address long-standing financing gaps, and bolster employment and entrepreneurial ecosystems across underserved geographies.
About SBI
The State Bank of India (SBI) is India’s largest public sector bank, offering a wide range of banking and financial services. With a vast network of branches and digital platforms, SBI plays a key role in financial inclusion and economic development across the country.
