A few large lenders will launch a new lending platform, based on the Open Credit Enablement Network (OCEN) protocol for micro-small-medium-enterprises (MSMEs), in the next one or two months, a senior executive aware of OCEN's development told MediaNama. Developed by the Bengaluru-based software products think-tank iSPIRT Foundation, OCEN is essentially a common set of application programme interfaces (APIs) that lenders and third-party apps can use to deliver loans digitally to MSMEs across the country. Much like UPI is a 'payments rail', OCEN is a 'credit rail'. OCEN will 'democratise credit': Earlier this year, Infosys co-founder and non-executive chairman Nandan Nilekani had announced the development of a new lending tool called 'OCEN', which would serve as a "common language" for lenders and borrowers, and would have a "dramatic impact" on how small businesses get loans. It is a means to "democratise credit" in a world where lenders are not able lend to small businesses due to high costs and data asymmetry, he said. "OCEN is a set of plumbing standards for fintechs and banks to interact with each other and standardises the communication between these financial entities, particularly for MSMEs that have been traditionally ignored by the formal financial system. The aim of this new type of lending system is to ensure that sub-prime and mid-prime MSME borrowers can get financing against their invoices," the senior executive quoted above said. MediaNama has reached out to iSPIRT for comments. Their responses will be added when received. Reshaping the existing ecosystem OCEN is…
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