BENGALURU - Indian private lender Axis Bank Ltd said on Tuesday it has signed a non-binding term sheet to invest 499-699 million rupees ($6.12-$8.57 million) for a 9.94% stake in Go Digit Life Insurance.
The development underscores private lenders' growing interest in India's lucrative and largely untapped insurance sector. The country's biggest private lender HDFC Bank also announced plans to buy a 9.94% stake in Go Digit Life last month.
Digit, which already has a presence in the general insurance business, is foraying into the life insurance segment with its Go Digit Life venture but has not yet received a licence for the unit.
Reuters had reported in August that Axis Bank's stake purchase would value the startup's upcoming life insurance business at $90 million. Axis currently offers some insurance products in partnership with Max Financial.
Go Digit General Insurance, Digit's general insurance business backed by Canadian billionaire Prem Watsa's Fairfax Group, had its planned initial public offering put on hold this month.
(Reporting by Meenakshi Maidas in Bengaluru; editing by Uttaresh.V)