ERPNext case study

Loan Origination System (LOS) for Ratnaafin (Supply Chain Finance)

Client Overview

Ratnaafin Capital Private Limited (commonly known as Ratnaafin), established in November 2018, is an Ahmedabad-based, RBI-registered NBFC specializing in MSME financial services such as business loans, working capital, supply chain finance, and solar finance.

Ahmedabad,India.

800+Employees

48Branches

5000+Channel Partners

Industry

Financial Services – Supply Chain Finance (SCF)

Apps implemented

ERPNext

Frappe HR

Framework

modules implemented

Manufacturing

Purchase

Sales

Quality Check

Accounts

Stock

Warehouse Management

Business Challenge in Supply Chain Finance Operations

Ratnaafin had existing LOS systems for other loan products; however, it did not have a structured, dedicated system for Supply Chain Finance (SCF). Over time, SCF onboarding and verification processes faced challenges in scalability, maintainability, configurability, auditability, and integration readiness.

Key issues included

Limited scalability for future SCF products

High maintenance effort due to custom architecture and manual dependencies

Low configurability for changing workflows

Increasing manual effort in onboarding and verification

Weak audit trail and compliance readiness

Integration limitations with external verification systems

Loan Origination System (LOS) – Core Implementation

The objective was to redevelop the LOS using the Frappe framework, while retaining continuity with Ratnaafin's business processes.

Reduce manual onboarding effort through automation and OCR-based data extraction

Improve data accuracy via KYC extraction

Strengthen compliance and auditability through controlled workflow

Enable integrations with external verification and bureau systems

Build a scalable base for future loan products with configurable workflows

Scope of Implementation

In scope:

Applicant onboarding (Individual and Legal Entity)

KYC document upload and automated data extraction

Identity verification through applicant name matching

Credit bureau integration (score + report retrieval)

Stage-driven workflow management for SCF Leads

Vendor-specific API integrations

Configurable document requirements, validations, workflows, and notifications

Out of scope:

Product-specific workflow variations

Loan disbursement and repayment processing

Accounting, ledger, and post-sanction monitoring

Solution Architecture & Lead-Centric Design

The LOS is a web-based application built on the Frappe framework and designed around a lead-centric model.

Each financing request is represented as an SCF Lead.
The SCF Lead progresses through controlled stages:

At each stage, the system enforces validations, role-based controls, and mandatory checks to ensure data completeness, accuracy, and compliance while maintaining operational flexibility.

Most applicant data can be extracted directly from uploaded documents using OCR, minimizing manual entry and enabling users to move ahead in the workflow faster.

The platform is highly configurable and supports requirement changes without code-level modifications. Document requirements, validations, workflows, notifications, and visibility rules can be adjusted based on evolving business needs.

Easy error navigation is built into the workflow — whenever a required field or document is missing, the system guides users directly to the relevant section for correction.

Role-based visibility ensures users only see information relevant to their responsibilities, supported by configurable permissions and access controls.

Up until the Disbursement Queue stage, key details remain flexible and editable as required by business processes, for example, updating applicant roles such as converting an applicant to a co-applicant.

Core Functional Modules Delivered

Applicant Onboarding & KYC Data Extraction

Users upload KYC documents against the SCF Lead

System validates document type and format

Documents are sent to a KYC extraction service (OCR-based extraction)

Extracted data is received and mapped to applicant fields

Applicant profile is auto-filled with extracted values

Exception handling:

If extraction fails, manual entry and correction are allowed

Re-upload and re-trigger supported

Compliance & Structure:

Secure handling of uploaded KYC documents

Audit logging for extraction and manual overrides

RBI-compliant field structures using linked master data

Applicant Name Matching for KYC Verification

Compares the applicant's name with different KYC documents

Supports detection of mismatches across different documents

Generates match status: Full / Partial / Fail

Stores results against SCF Lead

Controls:

If Fail, manual review required

Mandatory remarks for manual overrides

Early-stage detection helps prevent downstream discrepancies

Credit Bureau Integration & Vendor APIs

User-initiated or stage-triggered bureau pull

Validates mandatory identifiers (PAN, DOB, etc.)

Sends bureau request and receives response

Parses and stores credit score and credit report

Updates credit pull status on SCF Leadscore

Controls:

If bureau API fails, status marked Failed

Authorized re-trigger supported

Vendor-specific integrations designed to be extensible

Configurable Workflow, Visibility & Notifications

Document requirements, validations, and workflow transitions configurable without code changes

Role-based visibility and permissions configurable based on operational roles

Notifications configurable at triggers through multiple channels (Email, SMS, messaging platforms)

Easy navigation to missing fields or documents reduces operational friction during stage transitions

Supply Chain LOS (Sub-Product) – Workflow & Business Impact

The stage-driven workflow ensures:

Standardized onboarding and verification

Clear audit trail and traceability

Reduced operational errors

Role-based controls for compliance

Easy navigation to missing fields or documents when validations fail

The stage-driven workflow ensures:

Looking to build or modernize a Loan Origination System tailored for NBFCs and Supply Chain Finance?

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