The bank plans to use the funding to enhance its tech stack, strengthen its team and deepen partnerships as it moves to become the go-to bank for Indian MSMEs, Shivalik SFB said in a statement.
The SFB, which was an urban cooperative bank earlier, has a large presence in Uttar Pradesh and Madhya Pradesh. It has over 560,000 unique customers and runs 46 branches and 21 exclusive Business Correspondent Branches across northern India.
After the current round of equity infusion, Shivalik SFB’s capital adequacy ratio is expected to touch 30 per cent. Its CAR was 22 per cent at end of March 2022. The lender’s advances rose to Rs 1,126 crore at the end of March 2022 from Rs 805 crore a year ago. It expects the loan book grow at over 50 per cent in FY23.
Anshul Swami, Managing Director and CEO, Shivalik Small Finance Bank, said the investment will help the lender accelerate its growth as it looks to leverage digital banking adoption by small business and retail customers.
The bank officials said the lender would take a call on further capital injection after 12 months, depending on business growth and market conditions.
Rachit Parekh, Principal at Accel, said technology is increasingly becoming the financial services front-end for all Indians and is a key driver of financial inclusion. Banks such as Shivalik that understand this shift, have demonstrated financial prudence and are investing in technology.