Digital Document Execution (DDE)

DDE is a mode for paperless execution and storage of financial contracts, which will result in superior enforcement, thereby enhancing the ‘Ease of Doing Business’ especially in times where quick financing is the need of the hour for businesses.

NeSL’s DDE platform is designed to address and eliminate these inefficient processes as depicted below:

This concept was formulated under the guidance of Ministry of Finance and IBBI for NeSL to serve the financial sector in facilitating dematerialization of financial contracts

  • To save substantial resources in Digital E-stamping within a few minutes and
  • by affixing of digital signatures by parties to the contract on NeSL’s platform,

Documents executed on the platform of NeSL will ensure that the execution was error free and done in an efficient and effective way.

  • Creating loan and security documents with retrieval in a timely manner.
  • it makes the documents fully authentic ensuring that storage of the undisputed and
  • irrepudiable record of debt on the IU with confirmation of the disbursement/repayment
  • To preclude storage of physical documents by financial creditors resulting in substantial savings and easy retrieval of documents.

Ministry of Finance, Govt of India has advised State Governments to facilitate the implementation of digital e-stamping through NeSL- SHCIL/IGR platform vide notification No. S-33013/04/2019-ST-1-DoR (click to see).

What is DDE platform?

An acceptance or agreement on debt balances throughout the journey of the debt is good for:

  1. the borrower and lender,
  2. guarantors, security providers,
  3. auditors of the debtor,
  4. prospective lenders, credit rating agencies, credit scorers.
  5. Policymakers could use data of macro-level indebtedness, and
  6. Judicial fora would resolve disputes more easily, at times without the formal judicial system.

When all these stakeholders can view the same debt balance at a single source, it serves as a single source of truth. When this is possible to be done at a click of a mouse, it may arguably be the moment of reckoning. This moment has now arrived with Government of India establishing an infrastructure that stores data points of each financial contract, including the amount of debt, outstanding balance, security interest of lenders, default and financial statements or repayment history.

All financial contracts ranging from loans of banks or moneylenders, debentures, commercial paper, etc. are mandatorily filed with adequate details, including repayments in this digital repository. Each business transaction creates a creditor who is eligible to file details of credit provided to its buyers, including the payment due dates. In either case, when the due date for the payment is crossed, a default can be filed electronically which serves as an early warning to all creditors linked to the person that has failed to pay on the due date. There is no physical movement of files, only digital clicking. The era of paper and it’s scanning of invoices or demand notices is truly over.

The contract execution process in the DDE platform collapses several steps and is seamless, online and real-time in conjunction with the extant technology created by CDAC, a Government Esign Service Provider for the E-sign and the StockHolding Corporation (SHCIL  - CRA) or the GRAS system of respective state governments for the Digital E-stamping. The entire process of documentation of a loan contract takes about 6 to 10 minutes starting from upload of data by the lender to the DDE platform followed by E-stamping and E-sign; excluding time taken by borrower for perusal and acceptance of details of the contract on the DDE screen.

DDE provides a whole new contracting experience and leverages the legal evidentiary value of IU