BENGALURU: Indian startups will have to wait longer to own their non-banking financial company (NBFC) licence since the RBI has returned the applications of several of them, some of which are top-funded. These include Sequoia-backed BharatPe, Google Capital-backed CarDekho, and digital banking startup Jupiter, backed by Sequoia and Matrix Partners, three sources aware of the matter said.
The move follows recent geopolitical developments that have spurred tighter scrutiny of Chinese capital coming into local startups via tax havens like Mauritius, where most venture capital and private equity funds are registered. Second, money coming from funds registered in Mauritius, which is on the Financial Action Task Force grey list, is being seen as capital from a jurisdiction with weaker norms to counter money laundering. This has resulted in the RBI returning these applications.
India has been making moves to boycott Chinese influence in the economy since the border conflict. According to sources, the scrutiny of these applications has also increased owing to the involvement of limited partners – who invest in VC funds – with origins in China.
Most of these startups who applied for a licence and have raised VC funding will have to wait longer before there is a change in the RBI’s stance, people aware of the matter said. BharatPe co-founder Ashneer Grover and Jupiter founder Jitendra Gupta declined to comment. The RBI said it has nothing to comment on the matter, while an email sent to CarDekho did not elicit any response.