Slice has acquired a 5% stake within the Indian financial institution North East Small Finance in what analysts say is a key step within the unicorn fintech startup’s journey amid mounting challenges from the central financial institution that has toppled many younger corporations.
The Bengaluru-headquartered startup invested $3.42 million for the 5% stake within the Guwahati-headquartered small finance financial institution in September, a regulatory submitting confirmed.
The funding comes at a time when the Reserve Financial institution of India has clipped the wings of many fintech startups working in playing cards and lending classes by mandating strict compliance with stringent new pointers.
It’s unclear how a stake in a financial institution, admittedly a uncommon and ostensibly vital milestone by a startup, can be instantly helpful to Slice, a $1.55 billion startup that counts Tiger World, Perception Companions, Blume Ventures and Axis Financial institution amongst its backers.
The corporate didn’t reply to a request for remark.
The world’s second most populous nation is present process an attention-grabbing part of time as banks and fintech startups discover methods to enhance their engagements. Federal Financial institution and SBM Financial institution India have courted many startups as prospects in recent times as they try to supercharge their companies.
Slowly greater banks, together with HDFC and ICICI, have additionally expanded their deliberations with youthful corporations. HDFC, the biggest personal financial institution in India, not too long ago backed Mintoak, a SaaS platform that gives service provider companies in India and different markets.
The Indian arm of SBM Financial institution started participating with traders to lift capital late final yr, pitching the imaginative and prescient of changing into one of many high banking-as-a-service suppliers within the nation, TechCrunch reported earlier. Accel and Quona backed Shivalik Small Finance Financial institution final yr.
However an increase in proliferation of some predatory China-linked lending apps in recent times within the South Asian market has pressured the arms of the central financial institution to introduce guidelines which have a far-reaching impression on many corporations, together with these not concerned in bad-faith enterprise practices.
Included in 2016, North East Small Finance Financial institution is a subsidiary of RGVN (NE) Microfinance that serves prospects within the north japanese area of the nation. It counts Pi Ventures, SIDBI Enterprise Capital and Bajaj Group amongst its backers.
