IBDIC Exits RBI Sandbox with Blockchain-Based MSME Financing Platform

In a major boost to India’s fintech and banking innovation landscape, the Indian Banks' Digital Infrastructure Company (IBDIC) has become the only successful exit from the Reserve Bank of India’s Fifth Regulatory Sandbox Cohort. The company’s Deep Tier Financing Platform — built on blockchain-powered tokenized invoices — was the only solution to meet the central bank’s stringent success criteria. 

The cohort’s theme, “Neutral,” focused on testing solutions adaptable across financial segments. IBDIC’s platform stood out for its ability to deliver affordable, transparent, and scalable credit to micro, small, and medium enterprises (MSMEs).

Ashish Singhal, CEO of IBDIC, took to LinkedIn to share his thoughts on the milestone. He wrote, “This recognition is a testament to the vision, dedication, and collaborative spirit of our team, our partner banks, and the broader ecosystem that believes in building robust digital public infrastructure for the nation. We’re excited to continue our mission to transform trade finance and empower MSMEs under RBI’s guidance.”

Why This Matters

MSMEs contribute over 30% to India’s GDP and employ more than 110 million people, yet face a credit gap estimated at ₹20–25 lakh crore. Traditional lending often fails to reach smaller suppliers deep in the value chain due to high risk perception, lack of collateral, and fragmented data.

IBDIC’s platform addresses these challenges by:

✅ Enabling Regulated Entities (REs) like banks and NBFCs to adopt the solution in full compliance with RBI norms

✅ Extending credit to second- and third-tier vendors, beyond primary suppliers

✅ Using blockchain to tokenize invoices for tamper-proof, real-time verification

✅ Offering a cost-efficient, scalable model across industries and geographies

A Regulatory Endorsement

Of the five entities in the cohort, IBDIC emerged as the sole successful exit — a resounding endorsement of its business model, technological resilience, and operational viability. The platform’s architecture was co-created and rigorously piloted with HDFC Bank, ICICI Bank, YES BANK, and Aditya Birla Capital, alongside validation support from lead anchors and suppliers across diverse sectors.

“For India’s startup ecosystem, IBDIC’s success signals more than regulatory validation — it opens the door for fintech innovators to build on a shared infrastructure, reducing time-to-market and compliance overhead. As DPI becomes a launchpad for scalable solutions, startups could play a pivotal role in extending credit deeper into supply chains and underserved segments.” — Manoj Singh, Founder, TICE

This milestone not only affirms IBDIC’s institutional credibility but also signals a broader shift in India’s financial innovation landscape — where Digital Public Infrastructure (DPI) is becoming the backbone for scalable, inclusive solutions.

How It Works — At a Glance

• Invoice Tokenization: Supplier invoices are converted into secure, digital tokens via blockchain
• Real-Time Verification: Tokens are authenticated instantly, reducing duplication and fraud
• Deep-Tier Credit Flow: Financing reaches second- and third-tier suppliers
• Bank Adoption: Regulated Entities process financing within RBI guidelines
• Scalable Integration: Built to align with India’s public digital infrastructure

IBDIC’s DPI Vision — A New Backbone for India’s Banking Infrastructure

As India’s banking sector evolves, IBDIC’s success signals a shift toward shared digital infrastructure. The company plans to build platform-based solutions for key banking functions, including:

• KYC and identity management using secure, reusable credentials
• Blockchain-based trade and supply chain finance
• AI/ML-powered fraud detection and risk management
• Regulatory compliance aligned with RBI and government mandates

By pooling resources, banks can accelerate product rollouts, reduce costs, and ensure uniform service standards — increasingly vital as fintechs and neobanks raise customer expectations.

Strategic Implications

As a bank-created and bank-owned Digital Public Infrastructure (DPI) company, IBDIC blends the trust of traditional banking with the agility of blockchain innovation. Its Deep Tier Financing Platform could:

• Accelerate MSME financial inclusion with a regulator-approved tool
• Standardize supply chain financing across institutions
• Lay the groundwork for tokenized financial instruments in mainstream banking

The initiative aligns with India’s broader DPI narrative. Over the past decade, platforms like Aadhaar, UPI, and ONDChave transformed citizen services and business transactions. IBDIC could become the banking equivalent — a foundational layer for institutions and fintech innovators.

From Sandbox to Scale: What IBDIC’s Success Signals

If successful, IBDIC could redefine India’s banking infrastructure — making it faster, more transparent, and more inclusive. For SMEs, exporters, and everyday banking customers, this could mean cheaper credit, faster services, and greater trust in the financial system. But execution will be key: the company must maintain neutral governance, keep pace with evolving tech standards, and uphold global benchmarks for data privacy and cybersecurity — all while scaling adoption across industries and institutions.