About $1 billion in funds of Indian start-ups have been impacted by the collapse of California-based Silicon Valley Bank (SVB), Minister of State for Electronics and Information Technology Rajeev Chandrasekhar said on Thursday night.
Mr. Chandrasekhar said that of this amount about $200 million had been moved to bank accounts in GIFT City in Gujarat.
“The issue is, how do we make start-ups transition to the Indian banking system, rather than depend on the complex cross-border U.S. banking system with all of its uncertainties in the coming month,” Mr. Chandrasekhar said during a Twitter Spaces discussion.
The U.S. Treasury Department, Federal Reserve and the Federal Deposit Insurance Corporation (FDIC) have assured depositors that they will all be made whole, even though FDIC is only required to reimburse depositors up to $2,50,000 in lost deposits. The SVB collapse followed mass withdrawals, spurred by concerns on the bank’s leverage and fundamentals that went viral on messaging groups and social media.
(With inputs from Reuters, PTI)