India's central bank plans to ease rules for start-ups to access funds

[MUMBAI] India's central bank said on Tuesday it would ease rules for deals involving start-ups and was also considering whether to allow the fledgling companies to access offshore rupee loans.

The Reserve Bank of India will allow receipt of the deal value on a deferred basis in case of a transfer of ownership of a start-up enterprise, it said in a document posted on its website.

The new measures come at a time when global investors are tightening their purse strings, after pumping in billions of dollars in the last 24 months, as dreams of huge online sales are clouded by soaring valuations and still-distant profits.

Faltering start-ups could mean India missing out on huge potential: Bank of America Merrill Lynch has forecast Indian e-commerce will surge to US$220 billion by 2025 from about US$11 billion last year.

The central bank said it a statement it would also consider allowing start-ups to issue instruments like convertible notes to foreigners.

REUTERS