ICICI Bank Open to Investing in Startups

ICICI Bank Open to Investing in Startups: With the revolution in the field of startups and the substantial support by government, it seems that banks are warming up to the idea of investment in startups, in spite of great risks they surmount. Since the proposition of the Startup India Initiative, there has been a plethora of lenders wanting to invest in startup companies. They have even gone to the extent of planning different schemes for different startups. Though, banks have always been reluctant of funding in startups because of their risky nature and low success percentile, but the promises and efforts of government for startups have made banks think twice about their behaviour towards startups.

"We are looking whether we should also invest in these companies and if there is an opportunity and if there is a compelling proposition, we will look at it" - Executive Director Rajiv Sabharwal.

It is clear from the comment of Sabharwal that ICICI bank is seriously considering to be a part of ‘Make in India', yet it shows some hesitancy. Bank fund startups whose entrepreneurs have potential zeroes in their bank accounts. This is, we can say, an uncharted territory for banks to step foot into. "We don't have a dedicated fund line, but if there is an opportunity, we will look at it," he said, adding the bank already works with startups either individually or through incubators.

Since this January, when the government launched 'Startup India' initiative, a slew of lenders have announced plans for startups, even as the most successful startups have seen an erosion in valuations. The lenders' initiatives revolve around having dedicated branches and products with a focus on financial advisory for new-age entrepreneurs. 

Market leader SBI launched a dedicated branch for startups in Bengaluru, which was followed by a similar move by private sector lender RBL Bank today. Sabharwal said ICICI Bank is interested in technologies like big data and artificial intelligence, which will help it serve customers better. The bank today declared winners of a mobile application developing contest and said over 2,000 entries were received. The top honour went to Bengaluru-based startup employee Mohit Talwadiya for his 'Conversational Banking' app which will help do banking with ease of conversations based on natural language processing and artificial intelligence on multiple channels like chat and speech.

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