Why are Indian startups holding their breath?
Silicon Valley Bank has deposits of more than 14, 00,000 crores from investors and customers, out of which 89 percent of the funds are insured. As of 31 December 2022, SVB had total assets of $209 billion. Silicon Valley has always been the first choice for startups. Indian startups also used to get dragged like that. Now when the bank is locked, their restlessness has increased. According to a report, SVB Bank used to provide banking services to more than 2500 venture capital firms. There is also a significant number of Indian startups in this.
Silicon Valley was made the first choice
The job of Silicon Valley Bank was to provide banking service to the startup companies of the world. With the help of this bank, startups used to get funding easily. Due to the low interest rate and easy terms of liquidity, it became the first choice of startups. Although there are no clear figures, it is believed that the money of more than 60 Indian startups is stuck in America’s Silicon Valley Bank. Now due to the bankruptcy of the bank those companies are facing financial crisis. Crores of money of these startups are stuck in Silicon Valley Bank. American regulatory has banned the withdrawal of money from this bank. Troubled Indian startup company Nazara Technologies has Rs 64 crore stuck in SVB Bank.
Why choose Silicon Valley Bank?
There are many startups in India whose funding comes from abroad. SVB was a Wealth Manager, Financial Advisor, Networker along with the Bank. Because of which startups used to get all these services at one place. This was a major reason why Indian startups turned to Silicon Valley Bank. Silicon Valley Bank used to provide banking services to these startups as well as invest in those startups. Along with the loan, he also got investment from there. Startups used to consider this bank as startup and business friendly. People do not have to keep any minimum balance in this bank. Banks were always connected with startups company founders. Used to meet them, prepare investment plans for them, due to which Indian startups used to get drawn towards this bank of America.
why stir in india
The money of around 60 Indian startup companies is stuck in this American bank. Now the tension of these companies is increasing. Due to the prohibition of withdrawing money, now these companies are worried about how their expenses will go. How will they be able to pay salaries to their employees as the money is stuck? Although the central government has said that it will meet those Indian startups whose funds are stuck in SVB Bank. The central government should see how it can help them.
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