Transforming Indian NBFCs: Unlock Growth Through Synergy between Low Code and Generative AI

Transforming Indian NBFCs: Unlock Growth Through Synergy between Low Code and Generative AI

Non-Banking Financial institutions or NBFCs are fast becoming the cornerstone of India’s credit economy. As aspirations of the rising middle class fuel demand for accessible financing, NBFCs have stepped in to serve segments where traditional banks often hesitate.

Even as the Reserve Bank of India continues to tighten regulations to safeguard financial stability, NBFCs continue to anchor India’s credit-led growth — especially among the aspirational middle class.

The Financial year of 2024-25 turned out to be challenging compared to the previous year. I am highlighting two critical metrics – both pointing to growing concern of potential money mismanagement and heightened delinquency risk

• Rising Borrower’s Over-Indebtedness – As of September 2024, 8% of borrowers had active loans from four or more lenders, a sharp rise from 3.6% in 2021. This increasing overlap in borrower portfolios has elevated the risk of debt cycling — where individuals borrow from one lender to repay another.
• Moderating NBFC Credit Growth – After witnessing robust growth of ~21% in FY23, overall NBFC credit growth moderated to 15–17% in FY24–25. The microfinance AUM growth dropped sharply to 5%, down from 29.5% in the previous year.

The above scenarios reflect need to blend modern technology with strong governance – driven by synergy between low code platforms and generative artificial intelligence (AI)

Low Code and Generative AI Synergy: Unravelling Possibilities in the sector

There has always been the philosophical question amongst technology leaders across the sectors – Build vs Buy. The technological direction in NBFCs is not different from this. Over the years, a new movement is gaining momentum which is a cross between build vs buy and promises to unlock transformative benefits.

Low code is the modern technological phenomenon which has reemphasized the need to build with acceleration to evolve with customer’s growing preferences. The advent of generative artificial intelligence has solidified this momentum. And with platforms like OutSystems embedding this synergy by design, the future of financial innovation may no longer be a choice between build or buy — but between evolve or be left behind.

Visualizing Use-Case in this sector: A re-imagined System Built with Modern Tenets

The traditional loan origination process in Indian NBFCs—often segmented, manual, and rigid—is no longer equipped to handle the scale, complexity, and expectations of a digitally expanding borrower base. A modern Loan Origination System must be reimagined as an intelligent, adaptive, and hyper-agile platform.

This transformation can be enabled not by isolated approaches, but by the orchestration of Low Code and Generative AI into a single, cohesive operating model.

In this modern setup, Low Code acts as the digital backbone, allowing rapid configuration of workflows, user journeys, and integration points without deep-code dependencies. Business users and product owners can launch and iterate lending flows—like personal loans, gold loans, or MSME financing—within days. Dynamic credit rule engines, document checklists, co-lending interfaces, and compliance triggers can be visually assembled, tested, and deployed at speed.

Sitting atop this is Generative AI, which brings intelligence to content-heavy and document-driven stages of the journey. It automatically reads and summarizes KYC documents, parses handwritten income statements, and generates tailored communication—be it sanction letters, approval summaries, or borrower instructions in multiple languages. For NBFCs serving vernacular and semi-urban segments, this capability significantly reduces processing friction and improves transparency.

The third, and most transformative layer, is Agentic AI—a network of autonomous yet coordinated AI agents working across the LOS. These agents handle tasks traditionally reliant on human decision-making: eligibility checks, fraud pattern identification, personalized offer recommendations, and real-time underwriting.

For example, when a borrower uploads their PAN and bank statement, an AI agent validates the KYC, another extracts salary patterns, and yet another runs the applicant through policy logic—all in real-time, without manual involvement. Importantly, these agents are capable of memory, adaptation, and collaboration—ensuring that insights from one interaction improve the next, creating a learning LOS.

Together, this triad of technologies enables NBFCs to offer instant, accurate, and scalable credit origination while remaining fully auditable and regulator ready. The result isn’t just faster loans—it’s a fundamentally smarter lending institution that can grow responsibly, innovate rapidly, and serve Bharat as effectively as it serves metro India.

Possibilities Galore; Transformation of NBFC technological landscape

The loan origination example is merely a glimpse into what’s possible when NBFCs break away from legacy constraints. Across the credit lifecycle — from underwriting to disbursement, collections to restructuring — similar transformations await.

Imagine agentic AI copilots guiding field recovery agents in real time, suggesting empathetic but effective language to improve repayments. Or low-code platforms enabling faster launches of location-specific loan products during harvest or festival seasons. Or Gen AI generating intelligent dashboards that don’t just show portfolio health but proactively suggest where and how to intervene.

These are no longer moonshots. With the maturity of low-code platforms, the rapid evolution of generative AI, and the rise of agentic AI architectures, NBFCs are uniquely positioned to leapfrog.

Aaseya in strategic partnership with OutSystems, is well positioned to generate value across the credit lifecycle for NBFCs and baseline their competitiveness in accordance with similar institutions worldwide.