SUMMARY
I’m putting almost all of my money into Navi, said Bansal
Bansal-owned Chaitanya India Fin Credit has applied for a banking license
Sachin Bansal marked his entry into the financial services sector with the acquisition of CRIDS in 2019
Flipkart cofounder Sachin Bansal seems to be putting everything at stake for the success of his new venture Navi Technologies. According to media reports, he is likely to invest all the proceeds from the sale of his stake in Flipkart into the financial services company.
“I am putting almost all of mine (money) — that is going to happen in the next few days or weeks, whatever is left after Ola investment. All eggs in one basket,” Bansal told TOI. While he did not reveal the exact numbers, it could be anything between $400 Mn and $450 Mn.
This is also seen as one of the biggest capital infusions by a promoter into a new fintech venture. After his departure from Flipkart, Bansal, along with Ankit Agarwal, founded Navi Technologies in December 2018, which was earlier called BAC Acquisitions.
Earlier this month, the International Finance Corporation (IFC) said it is looking to invest $30 Mn for a 4.5% stake in Navi Technologies. According to an IFC disclosure notice, the transaction values the Flipkart cofounder’s new venture at around $650 Mn (INR 2100 Cr).
The Navi Journey So Far
Bansal acquired the non-banking finance company (NBFC) Chaitanya Rural Intermediation Development Services Private Limited (CRIDS) in September 2019 and took over as the CEO of the company.
CRIDS, which runs Chaitanya India Fin Credit (CIFCPL), provides the underbanked audience in rural areas access to the credit market. Founded in 2009 by Anand Rao and Samit Shetty, the majority of its business is in microfinance. It also provides loans for two-wheelers, housing, small business and education.
The acquisition saw an investment of INR 739 Cr ($104 Mn) by Bansal and his entry into financial services. Bansal had said that the fact that CRIDS provides financial access to people who don’t have access to other formal finance impressed him the most.
Recently, CIFCPL submitted an application to the Reserve Bank of India (RBI) for a universal bank license. The license is sought to increase financialisation by making banking simple, accessible and affordable via a consumer-centric and technology-driven approach. With the license application, CIFCPL aims to bridge the credit gap for the retail and MSME sector by developing industry-leading technology and global best practices as a mainstay.
Bansal said that the reason for the universal licence is that the regulators are very open to new ideas and he wants to operate across multiple sectors. “If you think like a consumer tech company rather than a traditional financial services company, you can solve some big problems,” Bansal said, adding that for India to become a $5 Tn economy, the GDP-to-credit ratio has to improve to 100% from the current 57%.
