India’s first dedicated branch for startups was inaugurated here on Tuesday under a pact between the Karnataka government and SBI to further boost the state’s startup ecosystem, which has been ranked the best in the country, and create new avenues for them to access credit and funding.
“Delivering as promised. Today we inaugurated SBI’s first exclusive branch for startups at Koramangala (in Bengaluru). It is the first in the country to provide financing to support startup growth. Facilitating entrepreneurs all the way to realize their dreams,” Dr. Ashwath Narayan C.N., Minister for Higher Education; IT & BT, Science & Technology; Skill Development, Entrepreneurship & Livelihood, Government of Karnataka said on Twitter.
The State Bank of India’s (SBI) exclusive startup branch at Koramangala — SBI Start-Up Branch — will provide services such as loans, deposits, transaction banking, outward and inward remittances, payments, cash management product, FOREX, insurance, custodial services, capital market and legal advisory, structuring, Demat and trading.
Karnataka holds the distinction as the ‘Best Performer’ in the Government of India’s States’ Startup Ranking-2021 for developing a strong startup ecosystem through holistic and inclusive policies for sector-focused incentives, and regulatory sandboxes, and supporting innovation in disruptive sectors.
Prashanth Prakash, Chairman, Vision Group for Startups, Government of Karnataka, and Founding Partner, Accel, said, “Happy to see the Government of Karnataka take the lead to be the first in the country to have a dedicated startup bank branch. The needs of startups are unique, and customised financial offerings and services would make them more accessible. Beyond VC funding, credit facility from banks plays a significant complementary role in ensuring capital adequacy for startups. It opens up new vistas for startups in the state.”
The SBI’s Start-Up Branch would act as a hub for various stakeholders assisting in providing solutions acting as spokes and supporting the hub branch in enabling startups to avail of end-to-end financial and advisory services through the branch. This hub will leverage the large presence of the bank in the market by bringing synergy among all entities and various departments of the state bank to offer a one-stop solution to these corporates and startups starting from the formation of the entity till the IPOs and FPOs of the companies.
The Karnataka Digital Economy Mission (KDEM) had entered into a Memorandum of Understanding (MoU) with SBI to boost the prevailing startup ecosystem for the state. Subsequently, SBI will also explore and open startup branches across three clusters (Mysore, Mangalore, and Hubblli-Belagavi) to facilitate and support startups based out of these clusters.
To add, the recent Global Startup Ecosystem Index (GSEI) by Israel-based StartupBlink says, Bengaluru is the “strongest startup ecosystem in India” and 8th globally. It has ranked the Karnataka capital along with the likes of San Francisco, London, New York, Boston, Beijing, Shanghai, and Tel Aviv. In this year’s GSEI rankings, among Indian cities, Bengaluru was at number 1. Globally, New Delhi ranked 13, Mumbai 17, Pune 90, and Hyderabad 97.
Karnataka boasts of a balanced ecosystem of IT & ITES, Electronics, Biotechnology and Innovation. These sectors complement each other and the startup ecosystem has more than 13,000 startups and 58 incubation centres across the state.