13.12 Co-lending

Epic overview

Build the co-lending module that lets the platform partner with banks and large NBFCs to scale book without proportional own equity. The module spans partner onboarding, allocation, booking handoff, daily MIS, settlement, reconciliation, NPA lockstep, DLG monitoring (where applicable), and partner-facing portal.

This is the single largest scale lever for a sub-₹500 Cr lender (see 1.2 Co-lending). Investment in clean co-lending architecture pays back as soon as the second partner is integrated.

User stories

As an admin, I want to onboard a new partner lender with their policy configuration, ratio split, escrow account, and MIS format — without engineering involvement for routine setup.
As a system, I want every co-lent loan to be correctly split per the partner’s agreed ratio and booked on both lenders’ systems within the agreed window.
As a partner risk team, I want daily MIS in my preferred format showing my portfolio composition, performance, NPA, and reconciliation.
As a partner ops team, I want to download daily settlement files showing what’s owed to me from the day’s collections.
As an ops user, I want settlement to reconcile cleanly with sponsor-bank statements; exceptions surface to a queue.
As a CRO, I want DLG cap (where applicable) monitored daily so I’m alerted before the cap is breached.
As an analyst running dual-policy decisioning, I want every co-lendable application to be run through both policies in parallel and produce a combined outcome.
As a compliance officer, I want NPA classification of co-lent loans to update both lenders in lockstep — same day, no divergence.
As a system, I want partner approval timeouts handled gracefully — fall to own book if partner doesn’t respond within SLA.
As an ops user, I want exception handling for buyback / substitution events when a pool exits or rebalances.
As a partner, I want a self-serve portal to see my portfolio, drill to individual loans with audit access, and download MIS.
As an admin onboarding a third partner, I want the allocation engine to balance new loans across all eligible partners per capacity and priority rules.
As an internal auditor, I want for any co-lent loan to retrieve full evidence — dual-policy outcomes, booking ack from partner, settlement evidence, lockstep classification proofs.
As an originator finance officer, I want a per-partner P&L view (origination fee earned, servicing fee, credit cost on own share, DLG instrument cost).
As a CTO, I want partner-specific API / SFTP differences abstracted so the core platform speaks one model.

API requirements

See 7.3 Co-lending APIs for full contract specifications. Headline endpoints:

Partner onboarding

POST /v1/colending/partners — onboard partner. Body: { name, master_agreement_ref, escrow_account, default_ratio, settlement_frequency, mis_format }.
POST /v1/colending/partners/{id}/policy — add partner policy version.
POST /v1/colending/partners/{id}/activate.
POST /v1/colending/partners/{id}/pause.

Allocation and booking

POST /v1/colending/applications/route — internal: route application to eligible partners.
POST /v1/colending/partners/{id}/loans/submit — submit loan to partner for approval.
POST /v1/colending/partners/{id}/loans/{loan_id}/sanction — notify partner of acceptance + sanction.
POST /v1/colending/partners/{id}/loans/{loan_id}/disbursed — notify partner of disbursement.

MIS and settlement

GET /v1/colending/partners/{id}/mis?date={d} — daily MIS for partner.
POST /v1/colending/partners/{id}/mis/generate — trigger MIS generation.
POST /v1/colending/settlements/{partner}/{period} — generate settlement.
POST /v1/colending/settlements/{id}/execute — execute (sponsor bank instruction).

Reconciliation

GET /v1/colending/reconciliation/{partner}/{date} — recon report.
GET /v1/colending/reconciliation/exceptions.

DLG

POST /v1/colending/dlg-agreements — create.
GET /v1/colending/dlg-agreements/{id} — current cap, instrument validity.
POST /v1/colending/dlg/invoke — invocation batch generation.

Buyback / substitution

POST /v1/colending/buyback — initiate buyback. Body: { loan_ids[], reason }.
POST /v1/colending/substitution — substitute one loan with another in same pool.

Webhooks (partner ↔ platform)

POST /v1/colending/webhooks/partner-decision — partner returns approval / decline.
POST /v1/colending/webhooks/partner-ack — partner acknowledges booking.

Data model

partner_lender, partner_policy, co_lending_agreement, pool, loan_allocation, dlg_agreement, dlg_invocation, settlement_batch, buyback_event, reconciliation_exception, partner_mis_template.

See 5.3 Core data model and 5.9 Schema reference.

UI screens

Admin

Partner master CRUD.
Policy editor per partner (with sandbox).
Allocation rules config (ratios, caps, priority).
DLG-agreement config.
Settlement frequency + escrow setup.

Ops

In-flight loan handoff dashboard.
Daily settlement dashboard.
Reconciliation exception queue with one-click investigation.
Buyback / substitution workflow.

Partner portal (separate, partner-facing)

Portfolio dashboard (overall + drill-down).
Per-loan detail with audit access.
MIS download.
Settlement history.
Performance metrics (NPA, vintage, yield).

Finance

Per-partner P&L view.
Settlement reconciliation per period.
DLG cap dashboard (across all agreements).

CRO

DLG cap monitoring (real-time per agreement).
Co-lent portfolio risk dashboard.

Backend services

Partner onboarding service — diligence checklist, agreement upload, sandbox setup.
Dual-policy decision orchestration — runs originator’s + partner’s policies, combines outcomes.
Allocation engine — single-partner / multi-partner / capacity-aware / priority-driven.
Booking handoff service — API / SFTP per partner; retry + circuit breaker.
MIS generation service — per-partner format; scheduled.
Settlement service — daily / weekly per agreement; sponsor-bank integration.
Reconciliation engine — escrow vs partner ledger vs own books.
DLG monitoring service — cap, invocation pipeline.
Partner portal BFF — read-only views with tenant isolation.

External integrations

Partner systems: REST APIs where available; SFTP fallback for legacy.
Sponsor bank escrow account for settlement.
Webhooks to / from partner.
MIS delivery: SFTP, API push, or partner portal download.

Test cases

Happy path

Partner onboarded; policy configured; sandbox loans booked successfully.
Dual-policy execution: both approve → CO-LEND; allocation per ratio.
Booking handoff via API: partner ack received within SLA.
Daily settlement matches per-loan share computations.
Reconciliation exception rate < 0.5% daily.
NPA lockstep update fires same-day on both lenders.

Failure / edge

Partner approval delay → SLA timer; fall to own book or REFER per policy.
Partner cap exhausted mid-batch → next loans go to fallback partner.
Partner system down at booking → queue + retry; ops alert.
Partner returns later acknowledgement than expected → reconcile against expected; flag if late.
Settlement mismatch → automatic exception queue; investigation workflow.
DLG cap approaches threshold → CRO alert at 4% and 4.5%.
DLG cap exceeded (regulatory breach) → critical alert + immediate ops action.
Partner exits arrangement mid-cycle → buyback workflow or substitution.

Compliance

KFS discloses both lenders.
Borrower communication routes via originator (single point).
Both lenders’ classification mirrored same day on NPA event.
DLG instrument validity tracked; expiry alerted.
Settlement audit trail per period.

Edge cases

Originator’s policy approves, partner declines → fall to own book if eligible.
Both partners approve a multi-partner-eligible loan → allocation per rule (rotation, capacity, priority).
Borrower’s loan was approved as co-lent but disbursement failed before partner funds in escrow → cancel partner booking; re-attempt or close.
Partner mid-period changes ratio → in-flight loans honour original; new loans use new ratio.
Settlement on a public holiday → batched to next working day; no SLA breach because policy expects it.
Multi-partner borrower (different loans with different partners) → distinct allocations; lockstep classification per loan applies to the relevant partner only.
DLG invocation timing miscount → audit + correction journal.

Acceptance criteria

One partner live end-to-end (Phase 2).
Multi-partner allocation operational (Phase 6).
Daily MIS + settlement automated.
Reconciliation exception rate < 0.5%.
DLG cap monitored daily; alerts functional.
NPA lockstep verified.
Partner portal self-serve with data isolation tested.
Partner-specific API / SFTP variations abstracted at adapter level.
Per-partner P&L view operational.
Full audit trail per co-lent loan retrievable.

Compliance touchpoints

RBI Co-Lending Guidelines — see 2.6.
TLE-MD — see 2.6.1 — re-characterisation safeguards for CLM-2.
PSL classification — see 2.6.2 — partner expectations.
DLG framework — see 2.5.
Outsourcing MD — partner-relationship governance.
Data sharing + DPDP — borrower-data shared with partner with consent.

1.2 Co-lending — business framing.
3.G Co-lending module.
7. Co-lending deep dive — operational + technical detail.
7.3 Co-lending APIs.
7.5 DLG monitoring.
5.8 Sequence diagram — Co-lending settlement + DLG invocation.