How account aggregators are making credit more inclusive in India
India has built one of the most advanced Open Finance infrastructures in the world through the Account Aggregator framework. This allows individuals and businesses to securely share financial data with consent across financial institutions using standardised APIs.
The Account Aggregator framework, introduced by the Reserve Bank of India as part of India’s digital financial infrastructure, enables secure, consent-based sharing of financial data between institutions.
Access to credit in India, for many decades, depended largely on collateral or credit history. Land, property, gold, or other tangible assets traditionally formed the basis for lending. This led to the exclusion of many individuals and businesses with viable economic activity but limited assets, leaving them outside the formal credit system.
As retail credit markets matured, this model gradually evolved toward bureau-based lending, where credit scores and repayment histories became central to underwriting. Today, the credit industry has entered another phase of evolution, where lenders are not only using bureau data or self-declared information but also accessing trusted data from gold sources as input for credit assessment.
Why financial data could make lending more inclusive
This transition is being enabled by the Account Aggregator (AA) framework, in India, a digital public infrastructure that allows individuals and businesses to securely share their financial information with regulated institutions after providing explicit consent.
The AA ecosystem includes around 15 entities licensed by the regulators as Account Aggregators, which integrate data from nearly 170 Financial Information Providers (FIPs), and disseminate this information to over 800 Financial Information Users (FIUs).
This alternative, data-led, consent-based ecosystem does not just replace traditional credit assessment; it expands the range of information available to lenders, facilitating a more comprehensive understanding of a borrower’s financial behaviour.
Instead of relying solely on static indicators such as collateral or historical credit records, lenders can evaluate dynamic indicators, including cash flows, income patterns, business receipts, and financial resilience. These data points provide a more complete picture of repayment capacity than conventional measures based on past credit behaviours.
One of the most important features of the AA ecosystem is that borrowers remain at the core of the data-sharing process. Information is shared only after explicit consent, with clear parameters regarding purpose, duration and the specific data requested.
This represents an important departure from models where consumers often have limited visibility into how their financial information is accessed or used. Greater borrower control has broader implications beyond credit underwriting.
As awareness of consent-based data sharing grows, individuals are likely to play a more active role in determining how their financial information supports loan and other financial product applications. This creates opportunities for stronger trust between customers and financial institutions while encouraging greater transparency across the ecosystem.
The shift from collateral to cash flows and consent
This is a win-win for the borrower and the lender. Access to trusted, most recent, and contextual financial data can improve speed and enable better decision-making. Lenders otherwise rely solely on document collection and manual verification, which are time-consuming and prone to errors and delays. This can reduce turnaround times while supporting underwriting decisions based on a wider set of financial indicators, including digital identity, payment systems and consent-based data sharing.
This also allows lenders to assess cash flows and financial behaviour alongside traditional credit history, creating a more complete view of creditworthiness, particularly for MSMEs, gig workers, and new-to-credit borrowers. Across the four credit bureaus and 15 licensed Account Aggregators. Together, these layers enable lenders to combine operational efficiency with more context-rich credit assessment, particularly for segments that have historically been difficult to evaluate through conventional methods.
Similar to any evolving technology-led ecosystem, even with this consent-based, data-led framework, there is a need for in-depth work on process design, consent architecture, customer awareness, and data governance, as these will continue to shape implementation. It is the responsibility of financial institutions to ensure that borrowers clearly understand what data they are sharing, its purpose, and how long the data will remain. This is essential for building confidence in these consent-driven financial services.
Additionally, it is important to maintain robust governance standards that safeguard the customer’s interests regarding security and privacy. India’s Account Aggregator framework is laying the foundation for a more transparent, consent-driven credit ecosystem by enabling borrowers to use their financial data as an additional indicator of creditworthiness, thus expanding the possibilities for more inclusive lending. As data continues to be central to lending, how consent frameworks evolve will shape both access and trust in India’s credit ecosystem.
Disclaimer: The information provided in this article is for informational purposes only and does not constitute financial, legal, or professional advice. While every effort has been made to ensure accuracy, readers should verify details independently and consult relevant professionals before making financial decisions. The views expressed are based on current industry trends and regulatory frameworks, which may change over time. Neither the author nor the publisher is responsible for any decisions based on this content.
Sachin Seth, Regional Managing Director, CRIF India & South Asia
