FininLaunches as Neobankin India in Partnership With SBM
Neobanking as a space already has incumbents such as Niyo which has a tie up with IDFC First.The neobanking start-up is targeting users in the age group of 18 to 40+ who basically belong to the mobile banking demography of India.Finin has secured funding from Unicorn India Ventures, PointOneCapital, and Astir Ventures in a pre-Series A funding round.
Finin, a fintech company, has launched itself as a ‘Neobank’, in partnership with SBM Bank, a wholly-owned subsidiary of State Bank of Mauritius in India, focussing on saving rather than lending. State Bank of Mauritius, is a bank in Mauritius that the Bank of Mauritius, the national banking regulator, has licensed as a commercial bank. SBM is the second-largest bank in Mauritius with a market share of about 25% of domestic banking assets. Neobanking as a space already has incumbents such as Niyo which has a tie up with IDFC First. Finin has secured funding from Unicorn India Ventures, PointOneCapital, and Astir Ventures in a pre-Series A funding round. The neobanking start-up is targeting users in the age group of 18 to 40+ who basically belong to the mobile banking demography of India.
In a press conference on 7th December, the bank put forth data analytics as its USP. Finin said it will provide features such as detailed break-up of user spending and send prompts if they exceed pre-set limits and automatic sweeps of money into liquid funds. The bank will target white-collar workers and freelancers and has waiting list of 15,000 people before launch. It aims to open 50,000 accounts in six months.Neobanking as a space already has incumbents such as Niyo which has a tie up with IDFC First. Finin has secured funding from Unicorn India Ventures, PointOneCapital, and Astir Ventures in a pre-Series A funding round, a press release issued by the company said.
No RBI permission is required to use the term Neobank in India, the companyCEO Suman Gandham, said in interview. “Data of customers will be held in India in compliance with applicable laws," he added. However, Gandham did not map specific ways in which the company will make money, simply stating that it will study users and then take a call. According to Gandham, Finin will bank more on revenue from wealth management operations rather than lending fees. These wealth management operations will include products like mutual funds and insurance.Opening neobank accounts are typically free to open and use. Moreover, neobanks are not bound by a physical location and are 100% online
SBM Bank offers an interest rate of 5% for saving account balances below 5 lakh and 6% for anything higher than that. It offers FD interest up to 7.5% for terms of 2-3 years, a shade higher than larger peers. This is likely to be a key pull factor for Finin.On the flip side, customers will have to rely on the SBM Bank branch network for banking activities that need physical branch presence. According to the SBM website, branches at present are confined to New Delhi, Mumbai, Chennai, Bengaluru, and Hyderabad.
