Mahindra Finance, SBI in co-lending pact for priority sector lending

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M&M Financial Services has entered into a co-lending partnership with the State Bank of India to offer affordable solutions to the NBFC’s customers.

The pact will harness the distribution strength of Mahindra Finance and the cost-efficient capital of SBI, ensuring wider outreach and better interest rates for customers, which will be determined based on the customer’s credit profile.

This will help unlock the potential of priority sector lending and ensure a “personalised and competitive financing experience”, the lenders said in a joint release, adding that the partnership reflects both entities commitment to empowering the MSME sector.

“With Mahindra Finance’s strong rural distribution network and expertise in the financial sector and SBI’s competitive capital cost, customers will get a competitive advantage. The objective is to extend joint financial support to customers thereby enabling credit to the unserved segments of the economy at an affordable cost,” the release said.

This is Mahindra Finance’s first co-lending tie-up with a bank. Under this agreement, the NBFC will facilitate leads and manage loan servicing while serving as a single point of contact for prospective customers.