Fintech startup Slice has got the shareholders’ nod to raise Rs 200 crore through non-convertible debentures (NCDs), company filings accessed via business intelligence platform Tofler show.
The timeline for the debenture issue is not known. Tough macroeconomic conditions and a difficult funding environment restricted Slice's previous round to a smaller amount at a lower valuation, sources said. So, the company decided to go the debenture way.
The Bengaluru-based company turned a unicorn after it raised $220 million in November 2021 led by Tiger Global and Insight Partners. A unicorn is a privately held company valued at $1 billion or more.
YourStory was the first to report on Slice's plans to raise funds through NCDs.
The fundraise comes on the back of the company discontinuing its core "Pay in 3" interest-free loan service for most of its customers. Launched to provide credit to unserved customers, the "challenger card" will now charge a 36 percent interest for payments made in more than one instalment.
Moneycontrol was the first to report on May 25 that the company was moving away from its core interest-free product by restricting the feature to only a few customers.
In May, Slice also introduced the Unified Payments Interface on its platform and announced a change in strategy to push its payments offerings.
The decision to charge interest on repayment models, other than the single instalment, and move towards payments offerings signals a more conservative approach amid a tough growth environment, with a focus on a profitable business model as startups look to reduce cash-burn amid a slowdown in funding.
By restricting the “Pay-in-3” feature on the card and allowing it for in-app payments, the startup is looking to shore up transactions on the app where it has strong revenue-sharing agreements with a number of brands.
The "challenger card" came under scrutiny after the Reserve Bank of India on June 20 prohibited credit-linked prepaid payment instruments.
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