Indian fintech unicorn slice has merged with North East Small Finance Bank (NESFB). The two have received a nod from the RBI for the merger which would help them expand tech-enabled financial accessibility nationwide.
Previously, slice had acquired a 5% stake in Guwahati-based North East Small Finance Bank for $3.42 Mn (INR 28 Cr).
The joint venture seeks to integrate advanced technology solutions with initiatives aimed at promoting financial inclusion at the grassroots level, an official statement said.
The merger is pending approval from shareholders and other necessary regulatory authorities.
“At slice, our unyielding devotion to customers and robust risk management have set us apart. This approach allows us to serve a wider audience, including those often overlooked, while also building a deep emotional connection with our customers,” Rajan Bajaj, founder & CEO of slice, said.
“We will further strengthen our risk underwriting through the use of technology and data, and always keep customers at the heart of our decisions. We see this as an opportunity to build a highly inclusive and responsible bank, offering an unparalleled experience, underpinned by robust risk management and strong governance,” Bajaj added.
Customers of both Slice and NESFB can expect an expanded array of products, omnichannel services, and a streamlined customer experience in the future, the statement added. Over the coming months, an integration process will take place, with both entities working diligently to ensure a seamless transition for all customers.
Founded in 2016 by Rajan Bajaj, slice (previously known as Slicepay) functioned as a buy now pay later (BNPL) platform until FY22. It provided a credit card-esque prepaid payment instrument (PPI) that came with no annual fees, interest, or late charges. However, due to regulatory challenges, the company discontinued this service last year.
In FY22, slice’s consolidated net loss widened 2.5X to INR 253.7 Cr from INR 100.4 Cr in FY21. Its operating revenue jumped 4.2X to INR 283.1 Cr from INR 67.7 Cr in FY21.
The startup entered the unicorn club in FY22 after raising $220 Mn in its Series B funding round led by Tiger Global and Insight Partners. Prior to that, it had secured $20 Mn in a funding round led by Blume Ventures and Gunopsy Capital.
Earlier, Slice used to offer prepaid credit cards but discontinued this service after the RBI’s decision last year, which prohibited non-banking financial companies (NBFCs) from providing credit lines on prepaid payment instruments (PPIs). In response, Slice implemented various reforms, separating its payments and credit businesses into two distinct verticals
North East Small Finance Bank Limited officially began its operations as a small finance bank on October 17, 2017. The Reserve Bank of India granted the bank a license under Section 22 (1) of the Banking Regulation Act, 1949, allowing it to conduct small finance banking activities in India.
It offers products and services including fixed deposit, daily deposit, savings account and serves customers in North-East India.
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