Slice Small Finance Bank closed its first funding round since converting to a regulated lender, raising $100 million at a $450-470 million valuation—a 70 percent markdown from its $1.5 billion peak in 2022.
The round reflects a wider reckoning in India's consumer fintech sector. Slice's path from buy-now-pay-later startup to small finance bank mirrors a forced pivot: the neobank model—partnering with licensed lenders to offer deposits and lending—has become structurally weak. Fi Money, which raised $160 million from Peak XV and Ribbit Capital, shut down banking services in March after its partner bank terminated the relationship. Jupiter, another neobank, acquired its own non-banking financial company license in 2023 to lend directly, a capital-intensive move that signals the partnership model is breaking down.
Slice's own path underscores the economics: In October 2023, it merged with Guwahati-based North East Small Finance Bank, acquiring a full banking license but inheriting a lender in distress. NESFB's capital adequacy ratio had collapsed to 5.5 percent in fiscal 2023, well below the Reserve Bank of India's 15 percent floor for small finance banks. The merger closed October 27, 2024, with Slice rebranded as Slice Small Finance Bank in May 2025.
The turnaround has been material. By the quarter ending June, the bank's capital adequacy ratio improved to 18.17 percent. Net profit swung to ₹50.9 crore from a ₹10.1 crore loss a year prior. Total income rose 39 percent year-on-year to ₹413.8 crore. Gross bad loans fell to 4.36 percent of advances from 6.31 percent. Deposits doubled to ₹5,765 crore, with low-cost current and savings accounts representing 43.9 percent of the base—a sign the deposit franchise is stabilizing.
Key investors in the round include Moore Strategic Ventures (₹106 crore), Japan's Kado Global (₹95 crore), Blume Ventures (₹44 crore), Raise Fintech (₹40 crore), and PixelSky Capital (₹25 crore). The capital raise—₹403.47 crore in compulsorily convertible debentures and ₹81.49 crore in partly paid equity—included a $5 million to $10 million secondary component in which existing shareholders exited to incoming investors.
Slice was founded in 2016 as SlicePay, initially offering credit lines to students and young professionals. The capital raise requires shareholder approval at an extraordinary general meeting scheduled for Friday.
