Digital Lending Platforms Market Outlook (2023 to 2033)
The digital lending platforms market is projected to be worth US$ 6.4 billion in 2023 and is projected to reach US$ 39.97 billion by 2033. The market for the digital lending platform is anticipated to expand at a significant CAGR of 20.1% during the forecast period.
Among the newest and fastest-growing areas of lending and credit, one of the most intriguing is a digital lending platform. A new approach to credit scoring, new technologies, and new credit scoring algorithms have contributed to the growth of digital lending. Digitalization is the norm today. Globally, human behavior patterns have changed over the years and are now changing at a rapid pace. E-commerce websites, the government digital push, the cashless economy, and many other factors are fueling the usage of online transactions in society.
According to the current market conditions, multiple companies are offering their customers the possibility of immediate loading on their loads at favorable interest rates with a short repayment period. Loans from these companies are much easier and faster to obtain than loans from banks.
Digitalization to become a global trend in India
The adoption of digital lending platforms in both small and large industrial sectors is on the rise
The growth of several young entrepreneurs will increase demand for digital lending platforms.
The number of leading fintech companies are expanding in the United States, India, China, and Canada in an effort to strengthen their positions in the market.
Cloud-based technologies and the expansion of mobile payment providers are increasing the demand for digital lending platforms. Faster and more affordable internet connections, the cloud, artificial intelligence, and blockchain technologies have created an environment conducive to the growth of FinTech start-ups, and the lending industry has been transformed into a digital industry.
Covid-19 has brought attention to the immense opportunities presented by digital transformation in the industry. Customers will demand more convenience from lenders as the use of contactless transactions increases. In order to reduce operational costs and enhance customer satisfaction, banks and nonbanking financial organizations (NBFCs) are digitizing a variety of processes, including customer onboarding, underwriting, loan disbursements, and repayments.
The Indian government has developed many digital lending companies that have developed a smooth financial management system. As a result of the digital sector as well as the inclusion of financial services in India, a great deal of progress has been made. There is a substantial amount of cash in the country that can be used for transactions. In the past few years, India has been trending toward becoming a cashless nation as a result of evolving methods of development and modernization.
A recent meeting between the governor and select fintech companies confirmed the RBI's commitment to facilitating innovation in the financial services sector through an ongoing consultative and participative approach. For example, a new set of guidelines on digital lending activities in India was issued by the Reserve Bank of India (RBI) in September 2022. With the new guidelines, existing loan disbursements and repayments were restricted, credit granted via e-wallets was prohibited, lending apps were regulated in how they collected fees, all digital loans were required to be reported to credit bureaus, fintech companies were required to collect and use customer data, and first loss default guarantees (FLDGs) were prohibited.
Loan application procedures will become more efficient and less cumbersome with services such as Aadhaar-based KYC, video-KYC, and cutting-edge websites. As part of the overall transformation of credit underwriting, the traditional credit application process will undergo radical changes. In order to evaluate a lender's creditworthiness more quickly and efficiently, lenders will rely more on artificial intelligence, machine learning, and big data analytics. Lenders are now able to offer credit to a wider range of individuals using alternative credit scoring technology, thereby improving financial inclusion.
ICICI bank has developed a new digital lending platform called iLens with Tata Consultancy Services (TCS). The entire loan application and credit disbursement process is digitized by iLens for borrowers. Customers who are seeking housing loans from ICICI Bank will initially be able to take advantage of iLens services.
Data Points
Key Statistics
Estimated Base Year Value (2022)
US$ 5.5 billion
Expected Market Value (2023)
US$ 6.4 billion
Anticipated Forecast Value (2033)
US$ 39.97 billion
Projected Growth Rate (2023 to 2033)
20.1% CAGR
Digital lending platform is a mortgage point-of-sale (POS) tool that manages the loan process through an online platform. The digital lending platform market helps businesses to improve user experience in order to attract new users from the financial services ecosystem. Digital lending platforms offers various benefits such as free up customer time, mobile features and eSigning, reduced cost, and quicker decisioning.
It also offers highly customized user experience, ease of entering data quickly, and streamlined loan application procedures. Most of the small and mid-sized enterprises are implementing digital platform for lenders that can utilize the time they save in engaging clients in non-digital relationship-building activities by using digital lending platform and due to this factor, the digital lending platforms market is expected to grow.
Also, digital lending platforms optimizes loan underwriting procedure at reduced cost and offers more efficient lending process and superior portfolio performance.
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Impact of COVID-19 Pandemic Outbreak on Digital Lending Platforms Market
The COVID-19 pandemic outbreak has created disruption in many industries, including the financial services sector. The COVID-19 outbreak has led to a collapse in cash-payment transaction by 30% owing to people hoarding cash for unforeseen circumstances amidst country-wide lockdown.
DLAI, an association of digital lenders have put forward a slew of demands to the government and the regulator to come out of the economic impact due to the lockdowns and curfew impacting lending activities and collections due to closures of businesses.
The primary USP of digital lenders lies in their business agility to serve small businesses more quickly than their larger competitors with innovative and personalized products. Lending fintechs have launched innovative products such as ‘anti-lockdown loans’ with flexible repayment plans and ‘Digital Lending 2.0,’ providing contactless loans for affected businesses. Amid the COVID-19 pandemic, due to financial instability, the market is expected to decline by nearly 120 BPS in H1, 2020 as compared to 2019.
Digital Lending Platforms Market: Drivers and Restraints
Rise in the adoption of AI, machine learning, and Blockchain-based digital lending platforms and solutions has boosted the demand for digital lending platforms for the past few years. The global digital lending platforms market is expected to witness significant growth during the forecast period, which can be attributed to the increasing adoption of solution such as loan origination, decision automation and others to protect traders and investors to increase transparency across financial transactions worldwide.
The continuous development of advanced technologies such as artificial intelligence, IoT, cloud, and network analytics are playing an important role in driving the growth of digital lending platform market.
However, the higher dependency on traditional lending methods is one of the major factor which may hinder the growth of digital lending platform market in near future. Also, the interoperability and lack of digital literacy in underdeveloped countries are some of the factors which may limit the adoption of digital lending platforms.
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Digital Lending Platforms Market: Competition Landscape
Some of the prominent players in digital lending platforms market are -
Fiserv, Inc.
Newgen Software Technologies Limited
Ellie Mae Inc.
Accenture
Cre8tech Labs Inc.
Decimal Technologies, among others.
Digital Lending Platforms Market: Regional overview
Based on the region, digital lending platforms market has been segmented into North America, Europe, East Asia, Latin America, South Asia & Pacific, and MEA. On geographic basis, North America is anticipated to hold the largest market share in terms of revenue, owing to the increasing adoption of cloud based digital ending platform by various enterprises in this region.
East Asia & Europe are expected to grow at highest growth rate during the forecast period due to rapid digitalization and rise in technologies and organization which offers better customer experience. South Asia & Pacific and Latin America also offers potential growth opportunities in digital platform market due to due to the high penetration of smartphones and high internet penetration rates enabling digital payments.
The digital lending platforms market report is a compilation of first-hand information, qualitative and quantitative assessment by industry analysts, and inputs from industry experts and industry participants across the value chain.
The report provides in-depth analysis of parent market trends, macro-economic indicators, and governing factors, along with Digital Lending Platforms market attractiveness as per segment. The digital lending platforms market report also maps the qualitative impact of various market factors on digital lending platforms market segments and geographies.
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The report covers exhaustive analysis on
Digital Lending Platforms Market Segments
Digital Lending Platforms Market Dynamics
Digital Lending Platforms Market Size
Supply & Demand Analysis
Current Trends/Issues/Challenges
Competition & Companies Involved in the Market
Impact of COVID-19 on market growth
Value Chain Analysis
Digital Lending Platforms Market Drivers and Restraints
Regional analysis includes
North America (USA, Canada)
Latin America (Mexico, Brazil, Rest of Latin America)
Europe (Germany, Italy, United Kingdom, Spain, France, BENELUX, Russia and Rest of Europe)
East Asia (China, Japan, & South Korea)
South Asia & Pacific (India, ASEAN, Australia & New Zealand, Rest of South Asia)
Middle East and Africa (GCC Countries, Turkey, South Africa, Rest of MEA)
Digital Lending Platforms Market: Segmentation
The digital lending platforms market has been segmented on the basis of component, deployment, industry and region.
