The Most Expensive Way to Learn in Fintech

You only really learn when you act.

When I started editing videos for my podcast, I didn’t take a course. I just began. I broke things. I exported the wrong formats. I messed up the audio.

Only when I was properly stuck did I look things up.

Action first. Google second.

The problem? That approach works for video editing. It’s expensive in business.

In fintech–NBFC partnerships, founders often sign first and discover the real terms later. The learning still happens — but the mistakes cost money, leverage, and sometimes the company.

Fintech–NBFC partnerships are high-stakes and surprisingly error-prone. Here are the three contract mistakes founders keep making — and how to avoid them.

3 Mistakes To Fix

1) Ambiguous Roles

The mistake usually sounds harmless.

The agreement calls the fintech a “technology platform” and the NBFC the “lender.” Everyone assumes the responsibilities are obvious.

They aren’t.

Founders often believe compliance, KYC, and credit risk sit entirely with the NBFC. Regulators don’t see it that way. Under RBI scrutiny, the NBFC is accountable for everything - including what your platform does on its behalf.

The fix is uncomfortable but necessary.

Spell it out.

• NBFC owns credit risk, lending decisions, and regulatory compliance

• Fintech acts as an LSP, responsible for technology delivery and customer acquisition

• Shared obligations for data security, grievance handling, and regulatory cooperation

If roles are vague, risk leaks. And when something breaks, everyone points at the contract.

2) Weak Data & Consent Structure

This is where many partnerships quietly fail.

Generic clauses about “data sharing” don’t survive RBI Digital Lending Guidelines or the DPDP Act. Regulators expect precision, not intent.

The fix is to treat data like regulated infrastructure, not an operational detail.

That means:

• granular customer consent, tied to specific use cases like KYC, underwriting, and collections

• strict data localization, with financial data stored only in India

• audit rights allowing the NBFC to review fintech data practices on a regular basis

When this isn’t defined, enforcement actions don’t feel sudden. They feel inevitable.

3) No Clear Grievance or Exit Framework

Most founders don’t plan for complaints. Regulators do.

Missing or weak grievance mechanisms are one of the fastest ways to attract attention you don’t want. And without clear escalation or exit triggers, small issues compound into regulatory breaches.

The fix is structure.

• a shared grievance redressal process, with clear SLAs for resolution

• defined termination triggers for repeated SLA failures or regulatory violations

• clean exit mechanics, including full return of customer data on termination

This isn’t pessimism. It’s operational realism.

Final Thoughts

The deeper issue isn’t drafting skill. It’s mindset. Founders are wired to move fast. Close the deal. Start disbursals. Fix details later.

That works in product. It works in marketing. It does not work in regulated finance.

In fintech–NBFC partnerships, contracts are not paperwork. They are risk allocation documents.

If you sign before you fully understand how risk, data, compliance, and exits are structured, you’re choosing to learn the hard way.

And in lending, the hard way is expensive. Act fast, yes. But read slow.