Silicon Valley Bank: Indian entrepreneurs had almost $1 billion in deposits with the troubled Silicon Valley Bank, and the country’s deputy IT minister claimed he had urged that domestic banks lend more to them in the future. Silicon Valley Bank (SVB) was closed down by California banking regulators on March 10 following a run on the lender, which had $209 billion in assets at the end of 2022. Depositors withdrew up to $42 billion in a single day, declaring the bank insolvent. The US government eventually intervened to ensure that depositors have full access to their monies.
Indian Minister highlights need to reduce dependence on US banking system
“The question is, how do we convince startups to switch to the Indian banking system rather than rely on the complex cross-border US banking system, with all of its uncertainty in the following month?” Rajeev Chandrashekhar, India’s state minister for technology, stated late Thursday night in a Twitter spaces discussion. According to Mr Chandrashekhar’s estimation, hundreds of Indian entrepreneurs have more than a billion dollars in SVB.
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Startups with $1 billion in deposits left stranded as SVB fails
Mr Chandrashekhar spoke with over 460 stakeholders this week, including entrepreneurs affected by SVB’s closure, and said he had forwarded their recommendations to Finance Minister Nirmala Sitharaman. Mr Chandrashekhar mentioned one of the recommendations he had passed on to the Finance Minister: Indian banks might give a deposit-backed credit line to startups that had money in SVB, using those as security. India has one of the world’s largest startup industries, with numerous companies reaching multibillion-dollar valuations in recent years and attracting the attention of foreign investors who have placed large bets on digital and other such ventures.
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