Explainer: What is RBI’s FLDG model?

The new framework comes with a new set of rules and stringent dos and don'ts for fintechs and banks and will significantly impact all stakeholders, including the end borrower. Among the things that the NGO does is helps these children open long-term FDs in their names and get college scholarships.

Explainer: What is RBI’s FLDG model?

Sunday June 11, 2023,

5 min Read


TVS Credit Services raised Rs 480 crore in equity from Premji Invest to fuel its growth plans, including advancing its digitisation journey. Through a combination of primary and secondary investments, Premji Invest will pick a 9.7% equity stake in TVS Credit for Rs 737 crore. 

In other news, tokens of major blockchain networks slid more than 20%, days after 13 tokens were alleged as securities in a US SEC lawsuit against crypto exchanges Binance and Coinbase.

The bulk of these losses came in the wee hours of Saturday, where Solana (SOL), polygon (MATIC), and Cardano (ADA) fell as much as 25% within hours—leading some on Crypto Twitter to wonder if a major crypto fund sold their holdings amid rather illiquid market conditions.

Do you know how much credit card debt Americans owe? The figure will leave you amazed!

On average, Americans carry around $5,733 in credit card debt, according to TransUnion’s latest report. 

In today’s newsletter, we will talk about 

  • Explainer: What is RBI’s FLDG model?
  • Fighting crime with education
  • Escape city chaos at The LaLiT Mangar

Here’s your trivia for today: What colour were carrots originally?


Explainer: What is RBI’s FLDG model?


Everyone in the fintech community is talking about ‘FLDG’. On Thursday evening, the Reserve Bank of India (RBI) revived the popular bank-fintech partnership model for digital lending, commonly known as First Loss Default Guarantee (FLDG). Here’s all you need to know:

Deep dive:

  • The new framework comes with a new set of rules and stringent dos and don'ts for fintechs and banks and will significantly impact all stakeholders, including the end borrower.  
  • In an FLDG arrangement, fintechs, which cannot lend directly, can get banks clients, perform certain services (such as sourcing loans, monitoring, pricing, and recovery), and—if the loan goes bad—guarantee a part of the loss up to a certain percentage.
  • The RBI imposed a complete restriction on FLDGs in August 2022, calling them 'synthetic securitisation’. However, less than a year later, the central bank revived the FLDG model with a new framework and stricter restrictions on how banks and fintechs can partner. 

Human Rights

Fighting crime with education

KR Raja

KR Raja

KR Raja, an advocate and a disability rights activist, is the de facto guardian to almost 1,000 children of convicts he has worked with. Raja has, so far, counselled more than 2,500 prison inmates, including undertrials and convicted prisoners serving time across Tamil Nadu since 2012.

His mission is to improve the inmates’ quality of life through his organisation Global Network for Equality, established in 2012, and, in turn, reshape the destiny of their children with education.

Improving lives:

  • Raja’s training as a psychiatric counsellor, criminologist, medical social worker, and lawyer has enabled him to identify the intersectionality of poverty, mental health, and crime. 
  • It helps him understand the dynamics that bring them together and find long-term sustainable solutions in criminal justice and crime prevention.
  • Among the things that the NGO does is helps these children open long-term FDs in their names and get college scholarships. Its work so far has been supported consistently by individual donors.

Travel and Leisure

Escape city chaos at The LaLiT Mangar

Lalit Mangar

Today, travel is more of a necessity than a luxury—largely due to the never-ending work that dominates our schedules. With staycations becoming popular, enjoying some downtime without travelling long distances is now a reality for many. 

And if you are a resident of Delhi-NCR, there’s good news for you. You can now experience the rustic countryside and soak in quietude just an hour away from the national capital at the LaLiT Mangar in Faridabad. 

Respite from city:

  • The Mangar Bani Valley—where the property is located—is one of Faridabad’s best-kept secrets. The verdant and breathtaking beautiful forest grove harbours rich flora and fauna. 
  • The LaLiT Mangar is sustainable in its ethos. The use of rammed earth puts in perspective the thought put behind building a property that’s not just luxurious but also livable for guests. 
  • You could head to Village Jewel—a jewellery museum in Mangar village—only a few minutes away from the property and look at artistic pieces collected from various states over 35 years.

News & updates

  • Royalty case: Enforcement Directorate has issued show cause notices under India's foreign exchange laws to Xiaomi, Deutsche Bank, HSBC, and Citigroup over alleged illegal remittances of $673.2 million made by the Chinese smartphone giant to foreign entities. 
  • Car crash: The number of crashes involving Teslas in Autopilot mode has surged over the past four years, with about 736 US crashes since 2019, reflecting the hazards associated with the increasingly widespread use of Tesla’s futuristic driver-assistance technology and the growing presence of the cars on US roadways.
  • Supernova: A sparkling new supernova, SN 2023ixf, was captured by a telescope atop Mauna Kea in Hawaii. It was first spotted within the spiral arms of the Pinwheel Galaxy by Japanese astronomer Koichi Itagaki on May 19 and is the closest one seen in five years. 

What colour were carrots originally?

Answer: Purple. The modern-day carrot wasn't cultivated until Dutch growers in the late 16th century took mutant strains of the purple carrot and gradually developed them into the sweet, plump, orange variety we have today.

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