The Ministry of Electronics & Information Technology’s (MeitY) recent push to digitise several new types of contracts may soon make paperless home loans a reality, according to experts.
The conventional home loan application process is seen as tedious, with multiple visits to the branch. The documentation process also involves stacks of papers, such as third party agreements, home loan agreements, etc.
National E-governance Services (NESL) MD & CEO Debajyoti Ray Chaudhuri, speaking at the Indian Banks Association’s banking technology conference in Mumbai on Saturday, said: “Recently, MeitY has issued a notification which allows home loans to be brought under the digital documentation category. We are still working on that, but that is now a distinct possibility. With vendor and supplier agreements being brought in, the possibilities are endless. I can visualise a situation when any contract can be available in demat form.”
NESL provides a digital documentation execution service for banks that enables contracts to be made electronically.
Bankers also expect a dramatic rise in digital lending in the coming years.
India’s largest bank, the State Bank of India has already built a loan portfolio of Rs 65,000 crore by enabling customers to borrow with a few clicks on the bank’s mobile app Yono. “We expect the portfolio to cross Rs 1 lakh crore this year. Besides this, in-principal approval for car loan, gold loan and home loan is being provided online,” SBI chairman Dinesh Khara was quoted as saying by Times of India.