Fintech firm Slice drops credit lines in favor of term loans post RBI action

• ByStartupStory     |    July 21, 2022

Having followed the Reserve Bank of India’s (RBI) June notice that sought to prohibit non-bank PPIs from extending credit lines, Slice, a pay-later card startup that has been significantly impacted by the move, has announced that it will now begin offering real-time transaction-based term loans rather than a credit line. Slice’s most recent product update introduced a new feature called ‘buy power,’ which evaluates every single transaction made by users and decides whether or not it will be executed.

Slice stated that it will use data science modeling & artificial intelligence (AI) to create better and faster transaction decisions. It promised clients that the newest product upgrade will not affect their credit ratings. Furthermore, it had requested that its clients verify their spending capacity on the app to see whether their purchase would be accepted at the point of sale (PoS). The RBI prohibited fintech businesses from loading credit lines into prepaid payment instruments (PPIs) or wallets last month, pushing card-based pay-later providers to reconsider their strategy.

According to Registrar of Companies (RoC) records obtained in June, Slice secured shareholder permission to finance Rs 200 crore by issuing Non-Convertible Debentures (NCDs).

Tiger Global Management, Moore Strategic Ventures, Insight Partners, and GMO VenturePartners contributed $50 million to the fintech startup’s Series C investment.  The firm stated that the funds will be used to boost the expansion of its new UPI solution. Slice has received $270 million in total funding so far.

ABOUT SLICE

Slice, founded in 2016 by Rajan Bajaj, provides credit and payment cards (in collaboration with Visa and SBM Bank) to young consumers with little or no credit history. Slice claims to have 5 million registered members on its platform but has yet to become profitable. 

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