Bank of India joins PSB Xchange as lending partner

Bank of India has joined PSB Xchange as a lending partner, adding another bank to the digital working capital finance platform for MSMEs.

Under its agreement with PSB Alliance, Bank of India will offer supply chain finance to eligible borrowers linked to participating anchor corporates on the platform. The setup allows the bank to use a single digital system to reach multiple corporate ecosystems, rather than building separate lending links with each.

PSB Xchange is a multi-lender platform developed by Veefin and backed by PSB Alliance, which 12 public sector banks promoted. It connects lenders, corporates, fintechs and MSMEs for the digital execution of supply chain finance and working capital programmes.

Bank of India's addition expands the platform's lender network and widens access to institutional credit for dealer ecosystems across sectors. It also reflects a broader shift in banking towards shared digital infrastructure for working capital finance, as lenders seek to reduce the operational burden of one-to-one integrations.

Shared model

In India, supply chain finance has often been built through separate programmes between banks and individual corporates, creating a fragmented structure that can be difficult to scale. A shared model, such as PSB Xchange, is designed to standardise onboarding, documentation, and programme execution across multiple participants.

That standardisation can support digital onboarding, credit assessment and financing through a single process. It can also help lenders launch programmes more quickly and monitor portfolios across a broader set of borrowers.

For MSMEs and dealers, the appeal is faster access to formal working capital finance through established corporate networks. For corporates, the model offers a way to support dealer liquidity without setting up separate financing arrangements with each bank.

Vinayak Shukla, General Manager, Bank of India, outlined the bank's rationale for joining the platform.

"Dealers and MSMEs are an integral part of India's business and distribution ecosystem. Our participation on PSB Xchange will enable Bank of India to provide timely and digitally enabled working capital solutions to dealers associated with established corporate anchors. This collaboration is aligned with our focus on strengthening MSME financing and expanding access to formal institutional credit."

Wider access

The latest onboarding broadens financing options for dealer networks and strengthens the shared ecosystem of lenders and corporates, according to the platform's operators. The approach is intended to move supply chain finance away from siloed programmes towards a connected structure that can serve a wider base of smaller businesses.

"The evolution of supply chain finance requires collaborative digital frameworks that can support growth across industries. Through PSB Xchange, we seek to enable such frameworks by bringing lenders, corporates and ecosystem partners onto a common platform. Bank of India's onboarding further strengthens this network and broadens opportunities for MSMEs to access institutional finance," said Anjali Mohanty, Managing Director and Chief Executive Officer, PSB Alliance.

Veefin, which developed the platform, is among the fintech groups building digital infrastructure for multi-lender working capital finance in India. Its role in PSB Xchange places it in a part of the market focused on connecting public sector banks, non-bank lenders, corporates and small businesses through common systems.

The model aims to lower acquisition and integration costs for lenders while increasing the number of borrowers that can be assessed through digital channels. In practical terms, banks can plug into existing corporate ecosystems on the platform rather than negotiate and build each programme from scratch.

"Bank of India's participation is an important milestone in strengthening the PSB Xchange ecosystem. By bringing the bank's lending capabilities onto a unified digital platform, we can enable corporate dealer networks to access institutional finance with greater speed and efficiency. This collaboration demonstrates how technology and the reach of public sector banks can work together to expand working capital access for MSMEs," Raja Debnath, Managing Director, Veefin Group, said.