The Silicon Valley Bank may be the 16th largest lender in the US, but it was the biggest in terms of deposits for Silicon Valley, home to top tech firms. Just like half of US tech and biotech firms tied to SVB via partnerships, Indian startups including Meesho, Naaptol and Paytm were linked to it through their investors.
Now India's minister of state for IT has admitted that $1 billion from the Indian startup ecosystem was deposited at the bank which was shut down.
Where do Indian startups stand?
With SVB now out of business following a mass withdrawal of $42 billion, the Indian government is working on shifting banking for the country's startups to India.
The US Federal Deposit Insurance Corporation has already set up a Deposit Insurance National Bank, to release $250,000 guaranteed to each account holder.
In India, union minister Rajeev Chandrasekhar met 450 Indian startup CEOs, to reassure them that Indian banks can keep them safe.
Indian startups pulling money back from the US
He also added that more than $200 million belonging to Indian startups has been moved to banks in the GIFT City in Gujarat.
Residents of India get to open foreign currency accounts for overseas transactions with lenders opening branches in the financial hub.
HSBC, which has rescued SVB in the UK, has also offered foreign currency accounts in GIFT City to help Indian startup clients secure funds closer home.