Fintech platform Slice’s fundraising is on hold as RBI note triggering uncertainty for sector
- ByStartupStory | July 18, 2022
After the Reserve Bank of India issued a circular last month prohibiting prepaid payment instruments (PPIs) from loading credit lines, the ongoing fundraising for fintech company Slice has been put on hold, multiple sources familiar with the matter confirmed. According to those with knowledge of the situation, the company’s investment round, which saw Tiger Global secure $50 million last month in total, has been put on pause while stakeholders await clarification. Following the RBI circular, agitated fintechs have written to the central bank to ask for additional details on its response.
Slice was in discussions with potential new and existing investors to raise at least another $50 million for its most recent round. After receiving $220 million in a round-headed by Tiger Global and Insight Partners, the Bengaluru-based company joined India’s long list of unicorns, or firms with a valuation of more than $1 billion, in November of last year. After receiving an investment of $50 million in June, it had a worth of almost $1.5 billion.
According to those briefed on the situation, investors want to see a clear picture before investing in credit card-challenging firms like Slice, Uni, and others, even though the company has sufficient funds from its prior investment round. Through trade groups, these startups have started a conversation with the central bank and suggested solutions to issues. Even as it slows down new issuances owing to regulatory uncertainties, Slice is still issuing new prepaid payment cards, but only after carrying out a thorough know-your-customer (KYC) procedure, according to a person briefed on the situation.
“Our investors fully support us, and we have excellent capitalization. The founder and CEO of Slice, Rajan Bajaj, said in a statement, “We have total faith in the regulator and are committed to complying with evolving legislation while preserving the best levels of governance.”
In a letter sent earlier this month to his team, Bajaj emphasised the need for the business to comprehend the RBI’s goal as it scales operations and makes use of its technology stack.
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