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Slice and North East Small Finance Bank Announce Groundbreaking Merger

Oct 5, 2023

By: BlinkX Research Team

In a historic move for the fintech sector, Bengaluru-based credit and payments start-up, Slice, is set to merge with Guwahati-based North East Small Finance Bank (NESFB). This development marks the first instance of a fintech firm transitioning into a small finance bank, and the Reserve Bank of India (RBI) has given its green light for the merger.

Slice, previously known as Slicepay, gained prominence by offering a credit card-like prepaid payment instrument (PPI) with distinctive features, including no annual fees, interest, or late charges, effectively operating as a buy now, pay later (BNPL) platform. The company experienced substantial growth, issuing between 300,000 to 400,000 cards per month, surpassing other credit card providers.

Although specific financial details of the merger remain undisclosed, reports suggest that Slice's revenue nearly tripled, reaching approximately ₹870 crore in FY23. In contrast, North East Small Finance Bank is estimated to be valued between $60-70 million. Slice's CEO, Rajan Bajaj, expressed enthusiasm for the merger, highlighting an expanded customer base and strengthened risk assessment through technology and data.

Rupali Kalita, MD & CEO of NESFB, described the merger as an exciting expansion of their reach and services. The bank intends to maintain its dedicated service to North East India, leveraging technology and a deep understanding of the community to offer top-tier financial services to the region.

Gunosy Capital is the largest stakeholder in Slice, holding a 14.84% stake, while co-founder Rajan Bajaj maintains an 8.21% stake. Vikram Chachra, founding partner at 8i Ventures, commended RBI's recognition of fintech's pivotal role in adopting a digital-first approach to banking. This move signals RBI's acknowledgment of the critical role fintechs play in championing digital-first banking and moving away from physical branches.