Central Bank of India Partners with IIFL Finance for Co-Lending to Expand Loan Access

Mumbai, March 12: Public sector lender Central Bank of India has announced a co-lending partnership with IIFL Finance Limited to provide loans to customers at competitive interest rates and expand credit access across the country.

The bank disclosed the development through a regulatory filing to stock exchanges, including the National Stock Exchange of India and BSE Limited, under the provisions of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.

Objective of the Partnership

The co-lending arrangement aims to combine the strengths of both institutions to increase lending outreach and improve credit availability, particularly among underserved segments. The partnership will follow the revised Reserve Bank of India guidelines on Co-Lending Arrangements (CLA) issued on November 28, 2025.

Through this collaboration, the two financial institutions will jointly provide loans while sharing risk and resources. Officials said the initiative is expected to help both lenders grow their loan portfolios and reach a broader customer base.

Role of Each Institution

Under the agreement:

IIFL Finance Limited will originate loan proposals through its nationwide branch network.
Both lenders will process the applications based on jointly defined credit parameters and eligibility norms.
Borrowers will benefit from a blended interest rate, combining the lending terms of both institutions.
IIFL Finance will manage and service the loan accounts throughout the entire loan lifecycle.

Strong NBFC Network

Mumbai-based IIFL Finance Limited is a retail-focused non-banking financial company registered with the Reserve Bank of India. The company is a major player in India’s gold loan segment and operates a wide network of 4,761 branches across the country.

As of December 31, 2025, the NBFC reported Assets Under Management (AUM) of ₹49,027 crore, reflecting its strong presence in retail lending markets, particularly among customers with limited access to traditional banking services.

Expanding Credit Reach

Officials noted that the co-lending model will enable the bank to leverage the NBFC’s distribution network while offering customers competitive lending rates. The collaboration is also expected to enhance financial inclusion by extending credit to a larger number of individuals and small businesses across India.

The partnership reflects a growing trend in India’s financial sector where banks and NBFCs work together to combine capital strength with last-mile customer reach, helping improve access to credit in both urban and rural markets.