RBI has mooted a unique, secure borrower iden-tifier to avoid duplication and misreporting of data with credit bureaus, and to improve loan access for borrowers.
“Credit information com-panies rely on credit institu-tions to provide accurate and validated IDs. Without this, duplication and misreport-ing remain risks. We must move towards a unique bor-rower identifier, which is se-cure, verifiable, and consis-tent across the system,” RBI deputy governor M Rajesh-war Rao said in his keynote address at the 25th anniver-sary of TransUnion Cibil. He stressed the importance of better data practices for em-powering borrowers.
The suggestion comes as RBI pushes for a unified lend-ing interface a digital plat-form that lets lenders access verified borrower data. Much like UPI lets users send money to any bank, ULI allows multi-ple lenders to offer credit to a single borrower:
Rao said that RBI is testing use of programmable digital rupees (CBDC) to give loans with restricted acceptance of
the digital currency. This would start with a pilot for tenant farmers under the ki-san credit card scheme. If suc-cessful, this could help extend collateral-free loans to small businesses, street vendors, and artisans, while creating digital records that make fu-ture lending easier.
‘Better Data’
➤ The suggestion comes as RBI pushes for a unified lending interface a digital platform that lets lenders access verified borrower data
➤ Much like UPI lets users send money to any bank, ULI allows multiple lenders to offer credit to a single borrower
The deputy governor said that RBI has taken several pol-icy measures taken to reduce information asymmetry, en-hance data quality and im-prove customer satisfaction. These included free access to full credit reports, appoint-ment of internal ombuds-men, and redressal frame-works linked to delayed cor-rections. With the introduc-tion of the Data Quality Index and mandatory disclosures
on wilful defaulters, he said, CICs are now more transpar-ent and accountable.
Rao also drew attention to the rapid expansion of digi-tal infrastructure in credit delivery. “The convergence of Jan Dhan accounts, Aad-haar and mobile phones, pop-ularly known as the JAM trinity, UPI and ULI, repre-sents a significant advance-ment in India’s digital lend-ing infrastructure,” he said.
Rao noted the potential of alternative data, AI and ma-chine learning in expanding access to underserved bor-rowers. “It seems that time is not far when alternative data will no longer be alternate, but it will be the main-stream,” he remarked. Simi-larly, the proposed Grameen Credit Score aims to help SHG members and rural bor-rowers enter the formal fi-nancial system.
Despite this progress, he struck a note of caution: “We must remain cognizant of the need for addressing issues around data accuracy, data se-curity, and model risk.” Re-sponsible innovation, he said, must uphold the core values of integrity, transpar-ency and public service.