JOIN USIn a bid to help startups in India, the country’s largest lender State Bank of India (SBI) on Thursday launched its wealth management offering and inaugurated a dedicated branch for startups.
While the wealth management service ‘Exclusif’ is targeted at the fast-growing affluent segment in the country, ‘SBI InCube’ — the branch for startups — would offer advisory services to budding entrepreneurs under one roof, SBI Chairman Arundhati Bhattacharya said.
Initially, SBI InCube would not be providing loans, but give startups financial management services, she said.
However, the bank would love to give them loans when they turn more mature, Bhattacharya said.
“Actually, funding could be done when they become a little more mature or they have sufficient number of orders for scaling the companies. Surely, then they can become good candidates for funding,” she said.
Asked whether SBI would help startups raise funds from equity market, she said, as of now, it is not the bank’s part of the mandate.
‘SBI InCube’ would be useful to startups because they need financial management advice apart from providing financial help.
“We still believe that we will be useful to the startups, though we are not giving them financial help, because financing is not the only thing that startups need. What they really need is a lot of financial management advice. So, we hope this kind of service will help them a lot,” she said.
To a query, SBI Managing Director (National Banking Group) Rajnish Kumar said after Bengaluru, the bank is thinking of launching the project in Pune and NCR, as much of startup activities is taking place in these three centres.
Talking about partnerships, Bhattacharya said the bank has been in touch with its mentors including former Infosysians Mohandas Pai and Nandan Nilekani who are guiding it on needs of startup companies.
On SBI Exclusif, Bhattacharya said it proposes to bring to customers a completely different and new approach to interacting with the bank.
The customers will have access to a dedicated Relationship Manager to take care of all their banking and investment needs.
Further, customers will have access to the best products across categories from market leading institutions as the bank has introduced an open platform, Bhattacharya said.
Later, responding to a query, Bhattacharya added that the Bank was looking at selling some of its non-core assets to meet higher capital requirement that will kick in with implementation of Basel-III norms from March 2019. “We have many non-core assets and investments in companies which will be used to raise additional capital,” she said without elaborating further.
She said the financial sector representatives recently met the finance minister Arun Jaitley and suggested many financial sector reforms. This includes increasing exemption limit under Section 80C, she added.