- RBI clears blockchain MSME financing platform for banks’ adoption.
- Tokenized invoices to speed up credit access for small enterprises.
- ICICI, HDFC, Yes Bank join trials of blockchain lending platform.
The Reserve Bank of India has approved a blockchain-based financing platform designed to improve credit access for micro, small, and medium enterprises. Indian Banks Digital Infrastructure Company (IBDIC) Pvt Ltd developed the platform, which passed all testing criteria within the Fifth Regulatory Sandbox Cohort.
RBI ensured that the solution met the necessary benchmarks at the testing stage. The validation implies that the banks and non-banking financial institutions can now implement the product, as long as they comply with the applicable regulations.
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How the Platform Works for MSMEs
The IBDIC solution uses blockchain and smart contracts to tokenize invoices approved by large enterprises. The invoices provide digital evidence of suppliers’ value addition and enable lenders to finance MSMEs directly on a digital platform.
Digital management of payment flows also occurs, where tokens are transferred between buyers and suppliers. This accelerates the working capital cycles and forms a transparent financing environment for small enterprises.
Importantly, it was piloted with some of the top financial institutions such as ICICI Bank, HDFC Bank, Yes Bank, and Aditya Birla Capital. Their participation indicates the preparedness of the platform to be adopted in the mainstream banking.
Results from the Regulatory Sandbox
The Fifth Regulatory Sandbox Cohort began in August 2024 and accepted five products for testing. Two of these, one of which was IBDIC’s, were vendor financing models. Nevertheless, RBI assured that the solution proposed by IBDIC was the only one that passed the evaluation phase.
This development indicates regulatory assurance in permissioned blockchain and establishes IBDIC as the first authorized blockchain-based MSME financing platform in the country.
Sandbox Policy Updates
In April 2025, the RBI moved to an on-tap sandbox framework, which allows fintech firms to submit applications at any time. Applications are currently handled via the PRAVAAH portal, and the new Enabling Framework for Regulatory Sandbox was released in February 2024.
This move to approve IBDIC’s platform sets the stage for a greater embrace of blockchain in the Indian financial industry. It also provides MSMEs with new opportunities to access affordable credit through tokenized and digitally managed financing models.
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