Non-banking financial firm Paisalo Digital Ltd. on Thursday announced that it was entering into a co-lending loan agreement with Karnataka Bank to meet the funding requirements of priority segments such as agriculture, retail, MSME, and women entrepreneurs.

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The Agra-based NBFC, in a stock exchange filing, stated that the co-lending agreement with Karnataka Bank will enable it to drive financial inclusion by providing low-cost financial solutions to priority sectors.

The agreement is in conformity with the RBI circular on co-lending of loans as released on November 5, 2020. Under co-lending agreements, banks and NBFCs enter into tie-ups for joint contribution of funding for priority sectors.

According to the RBI circular of November 2020, the co-origination of loans by banks and NBFCs for lending to the priority sector involves joint contribution of credit at the facility level by both the lenders as also sharing of risks and rewards.

The average assets under management (AUM) of Paisalo Digital rose by 19 percent year-on-year to Rs 3,010.7 crore as of December 31, 2022. Revenue rose by 21 percent year-on-year to Rs 355.2 crore while profit after tax rose by 13 percent to Rs 73 crore in the December quarter.

Its total geographic footprint stood at 203 branches and 2,125 postal codes, as of the December quarter. It added 8 new locations in the quarter under review.

The company also signed a co-lending pact with UCO Bank in the September quarter. It also has tied up with SBI wherein India’s largest lender has allotted 984 codes for the opening of new Customer Service Point (CSP) Outlets during the current fiscal year.

Paisalo Digital shares ended 2.93 percent lower at Rs 58.05 on Thursday.

(Edited by : Rukmani Krishna)