Shares of LIC- and SBI Life-backed Paisalo Digital rose over 7 percent on Friday, June 27, after the smallcap NBFC announced the signing of a fresh co-lending loan agreement with the State Bank of India (SBI). The agreement marks a significant expansion in the collaboration between the two institutions, aimed at improving credit access for small and medium enterprises (SMEs) across India. The stock gained as much as 7.3 percent intraday to hit ₹33.75 before settling with modest gains.
Paisalo and SBI Expand Partnership for SME Lending
Paisalo Digital Limited, a systemically important non-deposit-taking NBFC, formalised a new co-lending loan agreement with SBI on June 26, 2025. The agreement targets SME products and is an extension of their existing co-lending partnership launched in 2021. It aligns with the Reserve Bank of India’s November 2020 guidelines on co-lending, which promote greater credit flow to priority sectors by leveraging the complementary strengths of banks and NBFCs.
The new arrangement is designed to jointly fund SME loans, with SBI and Paisalo sharing responsibilities across origination, disbursement, servicing, and recovery—all via a seamless digital platform. The platform aims to serve businesses in Tier 2, Tier 3, and rural markets, thereby extending the reach of formal credit to underbanked regions.
Commenting on the development, Santanu Agarwal, Deputy Managing Director of Paisalo Digital, said, “This new arrangement with SBI underlines our shared vision to expand affordable and timely credit access to the backbone of the Indian economy.” He added that by combining Paisalo’s integrated physical and digital network with SBI’s scale, the partnership is well-positioned to catalyse entrepreneurship and employment nationwide.
According to the company, the SBI–Paisalo digital lending platform has already serviced over 94 lakh customers through 3,565 touchpoints across the country. With the inclusion of SME lending in its portfolio, the platform is expected to drive stronger growth in priority sector financing and help address the credit gap in underserved business segments.
LIC, SBI Life Hold Strategic Stakes
Paisalo Digital enjoys the backing of two major financial institutions. As per December 2024 BSE data, LIC holds a 1.35 percent stake in the company, while SBI Life Insurance owns a larger 9.87 percent stake. This strategic ownership not only strengthens the company’s credibility but also signals long-term institutional confidence in its growth roadmap.
Stock Performance
Despite Friday’s positive move, the stock has had a turbulent year. Shares of Paisalo Digital have corrected sharply, falling more than 59 percent from their 52-week high of ₹81.95 touched in July 2024. The stock recently rebounded from its 52-week low of ₹29.40 earlier this month. While it has gained 3.6 percent in June so far, this comes after a prolonged streak of declines—falling for six straight months. The stock dropped 5 percent in both April and May, 8 percent in March, 14 percent in February, 13 percent in January, and 2.4 percent in December 2024.
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