Explained: What Is Unified Lending Interface Platform? Here's How It Works

The ULI seeks to enhance efficiency by significantly reducing the time required to evaluate loan applications. Its primary goal is to facilitate a smoother, more seamless credit experience

The Reserve Bank of India (RBI) is currently running a pilot of the Unified Lending Interface (ULI), a platform designed to revolutionise the lending sector as the initiative aims to streamline the credit process. The ULI seeks to enhance efficiency by significantly reducing the time required to evaluate loan applications. Its primary goal is to facilitate a smoother, more seamless credit experience, particularly benefiting rural and smaller borrowers who often face delays and obstacles in the current system.

RBI Governor Shaktikanta Das said that the RBI anticipates the ULI will revolutionise the lending sector. “Just like the Unified Payments Interface (UPI) changed the payments ecosystem, similarly, we expect ULI to transform the lending landscape,” Das remarked on Monday at the Global Conference on DPI and Emerging Technologies in Bengaluru.

What Is ULI?

ULI is a digital platform designed to streamline and enhance the lending process. It is intended to address the substantial unfulfilled demand for credit across various sectors, focusing on agricultural borrowers and medium, small, and micro enterprises (MSMEs). By simplifying and expediting the loan application and approval process, the ULI aims to provide a more efficient and accessible credit system for these critical sectors.

The platform is expected to reduce the turnaround time (TAT) for processing and approving loans while simplifying the process for both lenders and borrowers.

How Does ULI Work?

The ULI aims to streamline the flow of information lenders require to process loans. Its goal is to facilitate a seamless exchange of digital information, covering financial parameters and including additional details such as land records from various data providers. This comprehensive approach is expected to significantly reduce the time needed for credit appraisal, especially benefiting rural and smaller borrowers.

The ULI is designed with a plug-and-play architecture, allowing quick access to information from diverse sources. It will feature standardised application programming interfaces (APIs) to ensure smooth data integration and retrieval from multiple channels.

Is ULI Active Now?

ULI is currently in the pilot stage and is expected to become available nationwide soon. RBI Governor mentioned that the pilot was introduced last year to facilitate frictionless credit. The central bank will use insights from this pilot to determine the full-scale national launch of ULI.