The FinTech boom began in India a few years ago startups realized quickly that lending was how they would make money interest, late fees, it was all quite lucrative. But first they needed permission from the RBI to lend and License to lend is hard to come by So startup found loopholes to exploit and grow their business. Finsh looks at one such loophole: prepaid instruments or PPI.
On Thursday, the Reserve Bank of India (RBI) published a circular on something called a First Loss Default Guarantee (FLDG). And in today’s episode for June 12th 2023, we tell you everything you need to know about it and why fintech startups are breathing a sigh of relief.