In the age of digitalization, businesses have to keep up with the latest trends in technology to stay ahead of their competition. One such technology that has gained popularity in budget 2023 announcement is Entity DigiLocker.
In the Union Budget 2023, the government introduced various measures to promote the adoption of digital platforms and encouraged the digitization of paper-based documents by proposing an enhanced version of DigiLocker in the form of Entity DigiLocker. Under this new initiative, digitized documents will be made available to SMEs and other businesses as well. This article will explore what Entity DigiLocker is and how it can benefit your business, particularly in terms of financing products such as NBFC business loans.
Entity DigiLocker is an extension of DigiLocker and allows SMEs to store and access important documents and certificates online. It is a cloud-based platform that provides a secure and convenient way to manage and share documents.
Entity DigiLocker is essentially a digital locker where you can store all your important financial documents and certificates in one place. This includes documents such as your Aadhaar card, PAN card, financial statements, audit reports etc. The platform will be linked to various government departments and agencies, which means that you can access and share your documents with them as and when required using common identifier.
Entity DigiLocker can benefit your business in many ways. Here are some of the key benefits for borrowers as well as lenders:
Easy access to documents: With Entity DigiLocker, you will be able to access all your important company documents and certificates online. This means that you don’t have to carry physical copies of your documents wherever you go. This will be particularly useful for underserved population in the country and ensure credit flow to SMEs through online access of financing products offered by NBFC or any other lending institutions .
Secure storage of documents: Entity DigiLocker provides a secure platform for storing your company documents. The platform will be protected by advanced security features, including two-factor authentication and encryption. This means that your documents are safe from unauthorized access and theft.
Streamlined verification of documents: When you apply for a business loan or any other financing products, you need to submit various documents to the lender for verification. With Entity DigiLocker, you will be able to share your financial information with the lender online, which makes the process faster and more efficient. The lender can access your documents in real-time and verify them without the need for physical copies.
Reduced paperwork: With Entity DigiLocker, you will be able to reduce the amount of paperwork involved in various business processes. For example, when you apply for a business loan, you can submit all your business documents online, which eliminates the need for physical copies. This not only saves time but also reduces the environmental impact of paper usage.
Compliance: With the implementation of various government policies, compliance has become an integral part of businesses. Entity DigiLocker will help both lenders and borrowers comply with government regulations and avoid any penalties or fines.
Cost Savings: By storing your business documents digitally on Entity DigiLocker, you will save costs on physical storage space and paper-based documentation. This can lead to significant cost savings in the long run.
Faster processing time: With Entity DigiLocker, you will share your company documents like GST registration certificate, bank statements etc. with the lender in real-time. This can significantly reduce the processing time of your business loan application. The lender can access your documents online and verify them without the need for physical copies.
NBFCs (Non-Banking Financial Companies) are financial institutions that provide various new-age financing products to businesses. NBFCs have become increasingly popular in recent years as they offer flexible financing options and are more accessible than traditional banks.
Using Entity DigiLocker for your NBFC business loan application is simple and straightforward. Here are the steps you will need to follow:
Sign up for Entity DigiLocker: To use Entity DigiLocker, you will be able to sign up using your company Aadhaar card. Once you have signed up, you will be able to start storing your documents in your digital locker.
Upload your documents: To apply for an NBFC business loan, you need to submit various documents to the lender. These documents include your PAN card, GST registration certificate, bank statements, financial statements and more. You will be able to upload all these documents to your Entity DigiLocker account.
Share your documents: Once you have uploaded your documents to Entity DigiLocker, NBFC will access your documents in real-time and evaluate them.
In conclusion, Entity DigiLocker proves to be a powerful digital platform that will benefit SMEs in many ways. When it comes to NBFC business loans, Entity DigiLocker can make the loan application process faster, more efficient, and more secure for SMEs. By using Entity DigiLocker, they can reduce paperwork, save time, and make the loan application process more eco-friendly.