This post on Z-connect addresses a lot of the queries around the concept of SLB in India.
According to this support page, Zerodha only supports SLB via offline route. Currently, you will have to raise a ticket via that support page to lend/borrow stocks on Zerodha.
As you are lending your shares, you would be getting them back at the prevailing market price at the time of return. The main aim of lending (for a lender) is to earn an additional return on an idle portfolio in the form of lending fees. An NSE document (Page 10) demonstrates an example P/L for both the borrower and lender taking part in an SLB transaction.
The post referenced earlier addresses this specific query -
Also an interesting thing is that in case the borrower wants an early repayment or lender wants an early recall there is a mechanism to do so. The borrower would place an early repay request with the fees they are willing to receive and the lender would place an early recall request with the fees they are willing to pay.
In case you are interested, the charges for using the SLB facility are explained in a different thread - Explain SLB charges please