Fintech Slice completes bank merger

Slice, which previously gained prominence by issuing credit card-like products, will maintain its existing digital payment and lending services while expanding into traditional banking offerings including savings accounts and investment products

Indian fintech firm Slice has completed its merger with North East Small Finance Bank. The merger, first proposed last year, transforms the startup into a banking entity, following months of regulatory scrutiny that has reshaped India’s fintech landscape.

Banking licenses have proved elusive in India, where the central bank has turned down most applications in recent years. The Reserve Bank of India’s (RBI) wariness stems from its experience with failed banks in the 1990s and governance lapses at Yes Bank and PMC Bank in the past decade.

While India has produced dozens of fintech unicorns, most must partner with traditional banks to offer basic services, making them vulnerable to regulatory changes and partner banks’ shifting priorities. This would explain why so many startups and venture firms are aggressively scrambling for a bank play in India, as TechCrunch has previously reported.

The bank merger gives Slice – which counts Tiger Global, Insight Partners and Blume Ventures among its backers – access to capital at lower cost and direct control over its lending operations. It can also allow Slice to launch and iterate products faster. Slice was valued at nearly $1.5 billion at the time of merger announcement last year.

For over a year, the teams at Slice and NESFB have worked tirelessly to make this merger a reality, according to Rajan Bajaj, founder and chief executive of Slice. Today, we are thrilled to be at the starting line of building India’s most loved bank, said Bajaj, who will serve the role of executive director at the merged entity.