Slice secures rare approval to merge with bank
Indian fintech unicorn Slice has achieved a significant milestone by securing approval from the central bank to merge with North East Small Finance Bank. This rare feat has eluded many tech giants, top financial startups, and tycoons for decades. The merger between Slice, which previously offered credit card-like cards, and the Guwahati-headquartered bank will enable the combined entity to better serve their shared mission and reach more consumers who currently lack access to basic banking services.
Key Takeaway
Indian fintech unicorn Slice has received rare approval from the central bank to merge with North East Small Finance Bank. The merger will enable them to expand their reach, enhance their product offerings, and serve underserved consumers. It showcases Slice’s commitment to customers and robust risk management, positioning them as a leading player in the Indian fintech industry.
Enhanced product offerings and accelerated product iterations
The merger of Slice and North East Small Finance Bank, following Slice’s earlier acquisition of a 10% stake in the lender, is expected to supercharge their product offerings and accelerate product iterations. Industry executives believe that this collaboration will allow the new entity to leverage innovative technology and focus on improving customer experience.
Favorable regulatory environment
In recent years, India has witnessed a pivotal banking phase, with banks and fintech startups forging collaborations. Federal Bank, SBM Bank India, and even larger banks like HDFC, ICICI, and Axis have engaged with startups to enhance their operations. The central bank has expressed concern about tech giants’ increasing presence in the financial services sector and has heightened its oversight. However, Slice, which holds an NBFC license, has successfully obtained approval for the merger, highlighting its robust risk management and devotion to customers.
Investment opportunities and market potential
The merger has garnered interest from investors, with at least two already in talks to invest approximately $125 million in the merged entity. The valuation of Slice was approximately $1.5 billion in its previous funding round, and its first investment in North East Small Finance Bank valued the lender at about $68 million. This collaboration creates opportunities for growth and expansion in the Indian market’s underserved segments.
India’s growing banking ecosystem is witnessing collaborative efforts between banks and fintech startups. The merger between Slice and North East Small Finance Bank signifies a trend of partnerships aimed at fostering inclusive and responsible banking for all. Together, they aim to deliver accessible and exceptional services while fortifying bank governance with continuous improvements in compliance, risk management, and leadership.
