New Delhi, August 14, 2025 — Shivalik Small Finance Bank (SSFB) has secured a fresh capital boost from SMBC Asia Rising Fund, an investment vehicle co-founded by Japan’s Sumitomo Mitsui Banking Corporation (SMBC). The fund has taken a 4.99% equity stake in the bank for $7 million (approximately ₹58 crore), placing Shivalik’s valuation at around ₹1,200 crore.
The investment forms part of a ₹100 crore equity-raising initiative, with existing stakeholders—including Accel, Quona Capital, Lightspeed, and Sorin Investments—injecting an additional ₹40 crore.
Transforming from Cooperative to Contender
Shivalik, which transitioned from a cooperative bank to a licensed small finance bank in 2021, has steadily grown into a significant player in India’s emerging financial services space. The bank now serves over 900,000 customers across 79 branches in 11 states, with a strong focus on secured lending—90% of its portfolio falls under this category.
For FY2024, Shivalik reported:
- Revenue: ₹423 crore
- Business size: ₹6,700 crore
Fueling Technology and Talent Expansion
Management has confirmed that the fresh funding will be directed toward:
- Upgrading technology infrastructure to improve digital banking capabilities
- Expanding the workforce across product development, engineering, and operations
By enhancing its tech backbone and human capital, Shivalik aims to improve customer experience and product innovation—key differentiators in India’s increasingly competitive small finance banking sector.
Strengthening Capital Adequacy for Growth
Before this round, Shivalik’s Capital Adequacy Ratio (CAR) stood at 19%. The new infusion is projected to lift it to 24%, giving the bank greater capacity to support its targeted 35–40% business growth over the coming years.
Strategic Significance of the Deal
For SMBC Asia Rising Fund, this investment offers an early foothold in India’s rapidly growing financial inclusion segment, where small finance banks are playing a critical role in serving underbanked and rural populations.
For Shivalik, the deal is more than just a capital raise—it opens the door to international strategic partnerships and potential collaboration in areas like digital banking solutions, credit products, and operational best practices.
The move also reflects a wider trend of global capital flowing into India’s regulated financial services sector, as investors seek stable growth opportunities anchored by robust credit performance and expanding consumer demand.
365247 Insight:
Shivalik’s dual focus on secured lending and technology-led growth could position it as a benchmark case for how small finance banks transition from regional players to nationally competitive institutions. The backing from a Japanese banking giant not only validates its business model but could also accelerate its climb up India’s financial services value chain.
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