Private sector lender Federal Bank is all set to start ‘Launchpad’, a dedicated service for startups. These services will pilot in Bangalore and Ernakulam, reported ET. These specialised lounges in the bank’s branches will offer advice on capital, regulatory support and even disburse funds.
Shyam Srinivasan, managing director of Federal Bank, said that the bank has a dedicated startup fund worth $3.7 Mn (INR 25 Cr) which it would like to use to fund or lend to promising startups.
He further said, “We are talking to three or four startups daily. The challenge for a bank is to move away from a conservative credit mindset to a more entrepreneurial mindset and to accept the fact that out of 40 or 50 investments, only one might take off. So, even we are in the process of understanding how to engage with startups better.”
Launchpad will support staff from the financial world and advisory mechanisms and would act as a perfect breeding ground for future entrepreneurs. It would be looked after by bank executives as well as local specialists who would be able to advise on regulatory issues.
The bank is also integrating its platform with mobile payments application ‘Chillr‘. Through Chillr, non-Federal Bank users will be allowed to instantly open a Federal Bank account through a selfie and an ‘Aadhaar’ identification number that will allow them to receive payments through ‘Chillr’.
In September 2015, the 70-year-old Aluva-based Federal Bank had started this $3.78 Mn startup fund to exclusively look at small-ticket projects with funding up to $15K (INR 10 lakh).