It went bankrupt after depositors withdrew $42 billion from this bank in one day. The US government then ensured that depositors could get access to their funds. Minister of State for IT, Rajeev Chandrasekhar on Twitter Said, “The issue is to bring startups into the Indian banking system instead of relying on the US banking system.” He told that hundreds of startups of the country have funds of more than one billion dollars in SVB. Chandrasekhar had held meetings with over 460 stakeholders this week. These included startups facing difficulties due to the closure of SVB.
Chandrasekhar told that he has forwarded the suggestions of these stakeholders to Finance Minister Nirmala Sitharaman. Citing one of the suggestions given to Sitharaman, he said that Indian banks could offer a deposit-linked credit line to startups that fund SVBs.
India is one of the biggest markets for startups in the world. In the last few years, many startups in India have achieved a valuation of more than one billion dollars. Foreign investors have invested a huge amount in these. The bankruptcy of SVB had an impact on the markets across the world. Due to this there was a huge fall in banking stocks. Consumer internet startups that have received large funding in recent years have had little impact because they do not have an account with the SVB or have very little funding in it. Analysts at JP Morgan have told that the country’s big software companies like Tata Consultancy Services and Infosys have more deposits in such regional banks of America which are facing financial difficulties. These companies may also have some deposits in SVB and due to this they may need to make provisions in the fourth quarter.
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