An Indian entrepreneur based in the United States has sparked discussion online after comparing his experiences with banks in India and America, arguing that differences in lending practices can influence how easily individuals and businesses access capital.
Shreyans Jain, co-founder of Y Combinator-backed startup Manicule, shared his observations on X after dealing with financial institutions in both countries. He said his experiences highlighted a significant contrast in how lenders evaluate borrowers and process loan applications.
According to Jain, American banks and credit unions can be more willing to extend substantial credit to borrowers who have a solid credit score and a relatively short borrowing history. He suggested that lenders in the US may place greater emphasis on an applicant’s credit profile when determining eligibility.
He contrasted that experience with what he described as a considerably more documentation-heavy process in India. Jain said applicants seeking business or personal financing may be required to provide a wide range of financial records, even when they have a strong financial background.
Among the documents he referenced were income tax returns, tax computations, bank statements, certified net-worth statements, business balance sheets and business tax filings. He argued that the extensive documentation can make the borrowing process more cumbersome for entrepreneurs and established businesses.
Jain also claimed that having a strong financial position does not necessarily guarantee loan approval in India. He described an instance in which a borrower could still be rejected for a comparatively modest loan despite having substantial assets and a strong financial record.
His comments have prompted a broader discussion about the differences between the financial systems of India and the United States. Access to credit is particularly important for entrepreneurs, as financing can determine how quickly a company can invest in employees, technology, infrastructure and expansion.
The comparison also highlights differing approaches to risk assessment. While Jain believes US lenders can demonstrate greater willingness to take calculated risks based on creditworthiness, he views Indian lending practices as more documentation-intensive and conservative.
However, his observations represent his personal experience rather than a comprehensive comparison of every bank or lending institution in the two countries. Loan requirements can vary significantly depending on the borrower, financial institution, loan type and business profile.
The discussion nevertheless offers an interesting perspective on the financial experiences of Indian entrepreneurs operating across both markets. As more Indian founders build companies with operations in India and the US, differences in access to capital and lending procedures are likely to remain an important part of the broader India-US business conversation.
