India's state minister for technology said on Sunday he will meet startups this week to assess the impact on them of Silicon Valley Bank's collapse, as concerns rose about the fallout for the Indian start-up sector.
California banking regulators shut down Silicon Valley Bank on Friday after the run on the lender, which had US$209 billion (S$281 billion) in assets at the end of 2022, with depositors pulling out as much as S$42 billion on a single day, rendering it insolvent.
"Startups are an important part of the new Indian economy. I will meet with Indian startups this week to understand the impact on them and how the government can help during the crisis," Rajeev Chandrasekhar, the state minister for IT said on Twitter.
India has one of the world's biggest start-up markets, with many clocking multi-billion-dollar valuations in recent years and getting the backing of foreign investors who have made bold bets on digital and other tech businesses.
SVB's failure, the biggest in the US since the 2008 financial crisis, has roiled global markets, hit banking stocks and is now unsettling Indian entrepreneurs.
Two partners at an Indian venture capital fund and one lender to Indian startups told Reuters that they are running checks with portfolio companies on any SVB exposure and if so, whether it is a significant part of their total bank balance.
Consumer internet startups, which have drawn the bulk of funding in India in recent years, are less affected because they either do not have an SVB account or have minimal exposure to it, the three people said.
"Spoke to some founders and it is very bad," Ashish Dave, CEO of Mirae Asset Venture Investments (India), wrote in a tweet.
"Especially for Indian founders ... who set up their US companies and raised their initial round, SVB is default bank. Uncertainty is killing them. Growth ones are relatively safer as they diversified. Last thing founders needed".
India's Nazara Technologies Ltd, a mobile gaming company, said in a stock exchange filing that two of its subsidiaries, Kiddopia Inc and Mediawrkz Inc, hold cash balances totalling US$7.75 million with SVB.