In January 2016, India's largest lender State Bank of India (SBI) had then setup a Rs.200 crore fund to invest in startups in the financial technology (Fintech) space. The bank however has not been able to invest in fintech startups even after over two years of announcing the 'Startup Fund'.
Now in a latest development in same, SBI is looking to modify rules for startup investments, said a report by Financial Express.
SBI chairman Rajnish Kumar told PTI, “We are a public institution and investments in startups are generally considered very risky. We understand that traditional way of investing will not work.”
The above statement came as surprise, as if SBI, as a public institution, believes that investing in startups is risky then why did bank announced the ₹200 crore startup fund in first place. Moreover, for a bank with a stature of being the largest bank in India and with over 2 lakhs employees (as on March 2017), it took SBI over two years of time to figure out that -- "investing in startups is RISKY".
Also Read - Amazon Leads $12 Mn Funding of Mumbai’s Insure-Tech Startup Acko
It is to be noted that the announcement of ₹200 crore startup fund was made by Arundhati Bhattacharya, who was chairman of SBI at that time, in January 2016.
In an event at Mumbai last weekend, Rajnish said the bank will be modifying the rules in order to plough-in the money. “We want to spend the money which we have earmarked,” Rajnish stressed, adding that it is keen to create more companies like online retailer Flipkart and ride sharing app Ola, which define the country’s prowess.
SBI chairman further said that the bank is also planning to invest ₹25 crore to set up a collaborative innovation centre in the satellite city of Navi Mumbai to promote latest technologies. The bank, which has 430 million customers or a third of the country’s population, has worked with over 150 startups till now on various cutting edge technologies including chatbot, data analytics, etc, according to SBI chairman.
Meanwhile, India has recently urged the Asian Development Bank to invest in health and fintech startups in the country, to help improve the quality of life in Asia while sharpening focus on infrastructure lending by ensuring loan disbursals within a year of request.
It may also be recalled that, in January 2016, SBI had opened a startup branch called InCube in Bengaluru which functions as a single point of contact for the startup account holders for their various banking and financial advisory related requirements.
Now in a latest development in same, SBI is looking to modify rules for startup investments, said a report by Financial Express.
SBI chairman Rajnish Kumar told PTI, “We are a public institution and investments in startups are generally considered very risky. We understand that traditional way of investing will not work.”
The above statement came as surprise, as if SBI, as a public institution, believes that investing in startups is risky then why did bank announced the ₹200 crore startup fund in first place. Moreover, for a bank with a stature of being the largest bank in India and with over 2 lakhs employees (as on March 2017), it took SBI over two years of time to figure out that -- "investing in startups is RISKY".
Also Read - Amazon Leads $12 Mn Funding of Mumbai’s Insure-Tech Startup Acko
It is to be noted that the announcement of ₹200 crore startup fund was made by Arundhati Bhattacharya, who was chairman of SBI at that time, in January 2016.
In an event at Mumbai last weekend, Rajnish said the bank will be modifying the rules in order to plough-in the money. “We want to spend the money which we have earmarked,” Rajnish stressed, adding that it is keen to create more companies like online retailer Flipkart and ride sharing app Ola, which define the country’s prowess.
SBI chairman further said that the bank is also planning to invest ₹25 crore to set up a collaborative innovation centre in the satellite city of Navi Mumbai to promote latest technologies. The bank, which has 430 million customers or a third of the country’s population, has worked with over 150 startups till now on various cutting edge technologies including chatbot, data analytics, etc, according to SBI chairman.
Meanwhile, India has recently urged the Asian Development Bank to invest in health and fintech startups in the country, to help improve the quality of life in Asia while sharpening focus on infrastructure lending by ensuring loan disbursals within a year of request.
It may also be recalled that, in January 2016, SBI had opened a startup branch called InCube in Bengaluru which functions as a single point of contact for the startup account holders for their various banking and financial advisory related requirements.
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