Financial services startup Groww moves domicile to India from the US

Fintech startup Groww has formally moved its domicile back to India from the US through a reverse flip by its parent firm, chief executive officer Lalit Keshre said on Thursday.

Groww joins an increasing number of startups planning to move their domiciles to the country. Many Indian startups domiciled abroad are considering shifting their base or reverse-flipping, to India. These include companies engaged in areas such as fintech,  e-commerce, stock broking, health care, and edtech.

“As of March 2024, Groww has completed its domicile transition back to India. For our customers, we have always been an India-based organisation for all practical purposes since day 1. With this update, the Groww group and its subsidiaries are completely based in India. By the way, today marks the completion of 8 years of Groww. Still, a long way to go,” Keshre posted on microblogging platform X, formerly Twitter.

Walmart-backed PhonePe, another major fintech startup moved its domicile from Singapore to India in October 2022. As part of this, it had to go through three steps. First, it moved all its businesses, including insurance and wealth broking, and all subsidiaries of PhonePe Singapore to PhonePe Pvt Ltd India. Secondly, PhonePe’s board approved creating a new employee stock ownership plan (ESOP) and migrating more than 3,000 PhonePe group employees. PhonePe’s investors, led by Walmart, had to pay about Rs 8,000 crore in taxes to allow the fintech firm to shift its domicile to India.

In March last year, the government noted that many Indian startups were domiciled abroad and set up a committee to suggest ways “to onshore the Indian innovation” to the International Financial Services Centre in the Gujarat International Finance Tec-City.

Experts said it helped to be in India if one was gearing up to list on the country’s stock exchanges through an initial public offering (IPO). Other factors include the rise of technology firms in India, investor confidence, a resilient economy, and supportive government policies.

 

Singapore-headquartered Eruditus is evaluating if it would be feasible for the edtech startup to move its base to India, according to sources. They said fintech firms such as Pine Labs and Razorpay were also considering the shift.

Besides local opportunities, fintech firms are making these efforts due to regulatory alignment with the Reserve Bank of India (RBI). In e-commerce, companies such as Udaan and Meesho are also exploring similar moves. Online furniture brand Pepperfry is also one of them, according to sources. The aim is to list on Indian stock exchanges and to streamline its group structure.

Nasscom, the apex body for the $245 billion technology industry in India, has also suggested to the government that India-focused startups incorporated overseas should be able to list on the domestic stock exchanges within the existing externalised structures.

In 2016, four Flipkart employees – Lalit Keshre, Harsh Jain, Ishan Bansal and Neeraj Singh – quit their jobs to start a venture that could make investing easy. They called this venture Groww and started operations in 2017.

An alumnus of IIT Bombay, Keshre of Groww looks after all the aspects of the business, predominantly the product and customer experience at Groww. Before starting Groww, Keshre was in a senior product management role at Flipkart, where he launched and led Flipkart Quick and helped launch Flipkart Marketplace. 

Earlier, he founded an online learning company called Eduflix, and he has also been an early team member at Ittiam Systems.

First Published: May 10 2024 | 1:34 AM IST