Analysts say Slice has a 5% stake in an Indian bank. North East Small Finance is a key step in the unicorn fintech startup’s journey amid mounting central bank challenges that have toppled many young firms.
A regulatory filing showed that the Bengaluru startup paid $3.42 million for the 5% stake in the Guwahati-based small finance bank in September.
The Reserve Bank of India’s strict new regulations have crippled many fintech startups in cards and lending.
Slice, a $1.55 billion startup backed by Tiger Global, Insight Partners, Blume Ventures, and Axis Bank, may benefit from acquiring a stake in a bank, but it’s unclear how.
The company did not comment.
Banks and fintech startups in the world’s second-most populous nation are experimenting with new engagement methods. Federal Bank and SBM Bank India have courted startups in recent years to boost their businesses.
HDFC and ICICI are also talking to younger firms. HDFC, India’s largest private bank, recently backed Mintoak, a merchant services SaaS platform.
TechCrunch reported that SBM Bank’s Indian branch pitched investors on becoming one of the country’s top banking-as-a-service providers late last year. Accel and Quona backed Shivalik Small Finance Bank last year.
In the past few years, there have been a lot of predatory lending apps with ties to China on the South Asian market. This has forced the central bank to make rules that affect many businesses, even those that aren’t doing anything wrong.
North East Small Finance Bank, which became part of RGVN (NE) Microfinance in 2016, helps people in the northeast. Pi Ventures, SIDBI Venture Capital, and Bajaj Group back it.