RBI initiated discussions for Slice merger with North East Small Finance Bank last year.
Slice and Guwahati based North East Small Finance Bank to merge.
Fintech unicorn Slice and North East Small Finance Bank (NESFB) announce their merger; receive RBI nod.
Lending startup Slice says it has got RBI approval to merge with North East Small Finance Bank.
Slice, in its meeting held today, has announced its merger with North East Small Finance Bank Limited. This is a significant move for the fintech industry after a positive signal from the RBI to revive the financially deteriorating bank.
The RBI has approved the proposed merger of Slice, a fintech unicorn with North East Small Finance Bank (NESFB), the local small finance bank headquartered in Guwahati, Assam.
Fintech unicorn Slice has announced its merger with North East Small Finance Bank (NESFB), a move that has received approval from the Reserve Bank of India (RBI).
This merger is seen as an endorsement of India's growing fintech ecosystem by the banking regulator and aims to enhance financial inclusion by combining slice's digital capabilities with NESFB's foundational banking services.
The joint entity will offer a broader range of financial products and omni-channel services to customers.
Slice had previously acquired a 10% stake in NESFB through two separate transactions. While the specifics of the merger deal were not disclosed,
both slice and NESFB mentioned that customers of both organizations would gain access to a wider array of products and services.
Over the coming months, an integration process will be carried out to ensure a seamless transition for customers.
Slice operates in the consumer payments and lending sector, primarily serving millennials and Gen Z.
It had previously issued prepaid cards with low credit limits but discontinued this service in response to RBI's new guidelines on digital lending.
The fintech company, currently valued at $1.5 billion,
had raised $50 million in funding led by Tiger Global in June of the previous year. In total, investors have injected $290 million into the fintech firm.
Vikram Chachra, founding partner at 8i Ventures and an early backer of slice, believes that the collaboration between fintech companies and banks will enable banks to provide a seamless digital experience to their customers, especially as India moves towards digital services accessible via smartphones.
Chachra anticipates more such mergers in the future, which can enhance the operations and balance sheets of small finance banks while granting fintechs access to necessary regulatory assets.
Rajan Bajaj, founder and CEO of slice, sees this merger as an opportunity to serve a broader audience and strengthen risk underwriting through technology and data.
Rupali Kalita, MD & CEO of NESFB, expressed their commitment to supporting underserved populations,
emphasizing the innovative technology and customer-centric approach of slice, and their dedication to enhancing bank governance through compliance and risk management improvements.