MSME lending moves from sachetisation to personalisation: Lentra’s Ankur Handa

India’s lending ecosystem is at an inflection point, where digital public infrastructure, data, and technology are creating new opportunities to expand formal credit to underserved consumers, especially MSMEs (micro, small, and medium enterprises), agriculture, and other segments. At the same time, lenders are under pressure to scale while strengthening risk management, compliance, and operational capabilities. Against this backdrop, Lentra, a cloud-based lending software provider, is expanding its focus from lending technology to support lenders’ broader growth ambitions through initiatives such as the Growth Alliance Program (GAP). In an interview with The Economic Times Digital, Pune-based Ankur Handa, Chief Business Officer, Lentra, discusses the evolution of digital lending, the rise of intelligent credit, GAP, challenges and opportunities facing India’s lending ecosystem, and more. Edited Excerpts:

The Economic Times Digital (ET): Give us an overview of your Growth Alliance Program. What was the motivation behind starting it, and what has been the impact so far?

Ankur Handa (AH): The sachet-sized loans and digital distribution were important parts of 2024-2025. What we are seeing in 2026 and 2027 is a move beyond just sachetisation towards the personalisation of these loans. We are looking at smaller ticket sizes and digital distribution. But now the question is, how do we make it more data- and contextual-intelligence-driven? That will be the key as we move forward.


Large banks probably have the right infrastructure to do this personalisation. But what about the ambition of smaller non-banking financial companies (NBFCs) and lenders that equally want to excel?

The core idea behind GAP is to look at how we can enable an emerging lender’s growth ambition and give them the infrastructure required to support that journey.

There are multiple NBFCs with excellent customer understanding, very strong distribution, and significant growth opportunities. But as they grow, they suddenly need much greater sophistication across onboarding, underwriting, decision-making, integrations, and servicing their portfolio. Then there is RBI-driven compliance and overall governance.

Historically, building that level of capability required significant investment, large technology teams, and long implementation programmes. So, we came up with the Growth Alliance Program (GAP). The idea is to simplify access to capabilities that have traditionally been available to large financial institutions, enabling emerging lenders to consume these resources without the need to build everything themselves. Our focus has been to simplify its consumption. Ultimately, GAP is about closing the gap between a lender’s growth ambition and its operational preparedness.

ET: What has been the response to the Growth Alliance Program since its launch?

AH: Following the launch, we held an industry event in Jaipur where around 21 financial institutions participated in an MSME growth-related programme. The beauty of GAP is that we have designed it in a way that a lender can join the programme through Lentra’s portal. It is more like a growth partnership; it is not a subscription. Lentra is here to bridge the ambition of a lender that wants to grow its assets under management (AUM) to Rs 2,000 crore or beyond. They can come onto our portal, provide some information about their NBFC, their AUM, and the kind of journeys or products they are interested in. They can then enter a partnership with us. Within 21 days, we can take them live on a running platform. We have seen a lot of interest and registrations, and it is also becoming a great channel for us to discover a new set of customers.

ET: What are some of the biggest operational and technology barriers smaller lenders face when trying to expand credit access across India?

AH: Operational and compliance maturity are the two biggest things when it comes to credit growth. As lending scales, operational maturity stops being a back-office issue. It becomes a growth capability. The first phase of digital lending was largely about access and speed: How do I reach more customers? How do I digitise the journey? How can I make credit faster?

But the next phase is going to be far more demanding. As volumes increase, you have more customers, more data, more partners, and more products; therefore, significantly greater operational and regulatory complexity. At this scale, compliance cannot remain something that is checked at the end of the process. It must be designed into the process itself. The same is true for governance, customer protection, data privacy, and all other risk control.

That’s why I see operational maturity and compliance maturity increasingly becoming part of the same conversation. A well-designed lending architecture should give you speed and control simultaneously. You cannot scale lending first and industrialise the operation later. The two increasingly must happen together.

This has been the biggest operational and technology barrier for smaller and regional lenders. We want to give them the technology and operational enablement so they can do this swiftly.

ET: How has lenders’ demand for digital lending infrastructure evolved in recent years?

AH: The divide still exists. Whether I look at established lenders versus emerging financial institutions, the divide hasn’t disappeared; it has just changed.

Ten years ago, the divide was largely around technology. Large institutions could afford sophisticated infrastructure while smaller institutions couldn’t. But with the advent of cloud, Software-as-a-Service and API-based solutions, along with the work being done by institutions such as RBIH (Reserve Bank Innovation Hub) and NPCI (National Payments Corporation of India), things have changed dramatically.

Technology itself is increasingly accessible today. But there is another divide emerging now. Basic automation, KYC, Aadhaar checks, PAN checks, and interfaces are available to everybody. But the ability to consume sophisticated technology is becoming the new emerging divide. A large bank may have hundreds of people across data, risk, security, compliance, and operations. A growing NBFC needs many of the same capabilities, but it cannot—and should not—replicate the organisational complexity of a large bank.

So, the next stage of democratisation isn’t just about making technology cheaper. It is about making sophisticated capabilities easier to adopt, integrate, and consume. A lender’s size shouldn’t be determined by the sophistication of the technology available to it. If we can evolve that, an emerging lender can compete on what it should really compete on: its understanding of the customer, its distribution channel, and its product and execution. That’s how our focus at Lentra is also moving towards intelligent credit, rather than just a credit solution.

At Lentra, we want to move beyond just loan origination. We want to be part of the broader credit lifecycle. Our intelligence layer for banks and financial institutions is where I believe our differentiation will come from.

We have the experience of scale and depth in lending. Through this intelligence layer, we want to achieve what banks are currently trying to achieve through many of their AI experiments.

ET: What are the biggest opportunities and gaps you see in the lending ecosystem currently?

AH: The lending ecosystem itself is expanding very rapidly. India’s lending ecosystem is at an inflection point right now. The biggest opportunity lies in expanding formal credit to underserved consumers—MSMEs, agriculture, and other segments.

All of this is being enabled by India’s digital public infrastructure and the growing availability of data. However, the real challenge is scaling responsibly.

Many lenders are grappling with legacy technology and increasing regulatory expectations. That is creating one of the biggest gaps between their business growth and operational readiness.

As smaller lenders start experiencing these regulatory expectations, that itself creates a gap between business growth and operational readiness. We believe the next phase of growth will be led by lenders that invest in lending infrastructure where these things can operate almost on autopilot.

For a large bank, there may be a big compliance team and a big technology team. Anything new coming from the regulator can be handled. But for a small lender, it can become a distraction. That is a structural gap.

Sustainable financial inclusion isn’t just about reaching more and more borrowers; it is also about building the operational capability to service them responsibly at scale and in compliance with what the RBI requires.

This is where I think we can help—by providing something that is on autopilot, continuously keeping track of what the regulator is saying, what new norms are coming through and how they can be adopted as part of the technology cycle.

ET: Finally, how would you assess the current climate for MSMEs, given the initiatives underway and the initiatives corporates are bringing in? Is it conducive for them to scale and grow?

AH: While it’s true for financial services and lending, you will always have cycles. Some challenges will keep coming through. There will be liquidity tightening or easing of liquidity. You will have inflation cycles. You will have geopolitical events impacting all of us.

So, the cycles of challenges and opportunities will always be there. But I feel the story of MSMEs in India is largely triggered by the fact that we are on a growth trajectory.

If we continue to grow with the kind of projections that we have experienced, we feel that 7%, 8% or 9% growth is within our reach for the next two decades. If growth is always going to be there, you need capital.

If India’s story over the next 20 or 30 years is going to be a growth story, NBFCs will continue to have opportunities. Maybe what I have learned in the last five years is that challenges will emerge. We went through the Covid-19 pandemic and, before that, demonetisation. There was a lot of talk about demonetisation breaking MSMEs in India. Of course, it was a challenging time, but MSMEs are still doing pretty well. More severe challenges will probably come, but I think there is a bigger underlying growth opportunity that we are living through.

As long as India continues to grow, MSMEs will continue to power that growth. And if MSMEs continue to grow, banks and lenders in India will grow. And if banks and lenders in India grow, companies like Lentra will continue to transform lending.