An oce(a)n of opportunity: anatomy of a lending protocol to lift bottom of the pyramid

Concept By Abdul Shafiq

Synopsis
Formal finance is available to only a section of MSMEs. The Open Credit Enablement Network or OCEN wants to democratise credit access. The pandemic is forcing a paradigm shift in the age-old lending practices -- from balance-sheets-based to cash-flow-based. However, big players are still waiting on the fence, as incentives to engage with the bottom of the pyramid is low.

Remember how Tim Berners-Lee and his team at CERN shaped the future of Internet with HTTP, or how clunky landlines made way for slick cellphones, or rather recently what UPI did to digital payments? Now move over to a new ecosystem, which’ll lend to those who otherwise struggle to get it. For, India is giving shape to a new credit protocol, which will ensure last-mile credit delivery to individuals and businesses at the bottom of the pyramid.