Neobank Jupiter is in talks to acquire a stake in SBM India, three sources familiar with the matter told TechCrunch, marking the latest example of an Indian fintech startup exploring a strategic partnership with a traditional banking institution.
The Bengaluru-based startup, backed by Tiger Global and Nubank, is working on buying a 5-9.9 percent stake in SBM India, the Indian unit of SBM Bank, the people said, asking not to be identified as the talks are ongoing and private.
The deal has not yet been finalized and also requires approval from India’s central bank, the Reserve Bank of India, the sources added.
The talks are in line with a growing trend among Indian fintech startups and venture capital firms looking to build relationships with lenders in South Asian markets. Indian fintech firm Slice received RBI approval last year to merge with Northeast Small Finance Bank, which it said would “allow it to serve a broader customer base, including those who are often overlooked.”
Venture capital firms Lightspeed and Sorin recently invested in Shivalik Small Finance Bank, following investments in the bank by Accel and Quona, and TechCrunch previously reported that Lightspeed was in talks to back the bank.
TechCrunch reported earlier this year that Premji Invest, Multiples, Zerodha, Gaja Capital and MobiKwik were among the firms looking to invest in Nainital Bank, a subsidiary of Bank of Baroda.
Jupiter and SBM India did not immediately respond to requests for comment.
Jupiter, a so-called neobank, has partnered with Federal Bank to offer modern financial services to Indian customers, but the adoption of such neobanks in India has been slower than in other markets such as Brazil, where they are taking off more quickly.
