The joint statement from the US Treasury, Federal Reserve and Federal Deposit Insurance Corporation (FDIC) stating that depositors will have access to all of their money starting Monday, March 13 in connection with the Silicon Valley Bank (SVB) collapse has come as a relief to the startups who were exposed to the bank.

Startups hope the crisis would now be resolved soon.

"FDIC’s communication yesterday saying all depositors will get access to their funds is a relief to the startup community,” said Prabhu Ramachandran, CEO & Co-founder at Facilio, a property operations software provider.

Facilio has significant exposure, as a “major portion” of the company’s funds is with SVB.

"But we expect the crisis to be resolved this week and we should get access to our funds. We have money outside SVB to cover 4-5 months of our operations. This gives us more than sufficient time for the crisis to be resolved, and for us to access our funds at SVB," Ramachandran said.

He added "while most SaaS (Software as a Service) startups had some kind of exposure, most of them had diversified their funds and operations did not get impacted as such. Also, we knew it was only a matter of days that this issue would get resolved."

"We understood the way it snowballed into and most of us didn’t get carried away by the noise. We took stock of our financials outside SVB and believed this problem would get resolved in a few weeks. We kept our internal teams updated on the situation. SaaS is a close-knit community here and we are speaking to each other to ensure the confidence within the community is held up," Ramachandran added.

However, the number of startups that are affected is “miniscule” say some.

"In the Indian startup ecosystem, the number of companies that have US bank account is miniscule. It is a problem for US companies, for Indian companies, a very miniscule section of the Indian ecosystem has been affected by the Silicon Valley Bank collapse," said K Ganesh - Serial Entrepreneur, Promoter - Bigbasket, Portea Medical, Bluestone, HomeLane.

"None of the startups mentioned in a section of the Indian media – BlueStone and TutorVista – have been impacted by the Silicon Valley Bank crisis. This is pure case of wrong understanding and sensationalising,” Ganesh said.

He added SVB had invested in these companies and taken equity or shares from them.

"The money came from SVB. Both BlueStone and TutorVista received money from SVB and gave them shares against that. Tutor Vista got the money 16 years back. BlueStone got the money 10 years back. That money has been consumed and utilised. Subsequently the shares have been sold and SVB is no longer a shareholder in any of these companies. Therefore, what happens with SVB has no relevance to these companies. Whether it is PayTM, Bluestone or TutorVista," he said.

Ganesh added, "if the same situation had happened 15 years ago, the news would not have spread so quickly. Now, the moment you get a whiff of a problem on social media or news reports, internet and mobile banking help people move funds immediately. Something like 20 billion dollars was removed in a day. Mobile internet banking makes a ‘run on the bank’ possible. While not blaming SM or mobile internet banking, the lesson is that the banking regulators have to learn how to avoid similar situation repeating in the age of social media."

Meanwhile, payment solutions and fintech companies are coming up with ways for affected startups to work around the issue.

A Razorpay spokesperson said, "we have been working round the clock and have created a dedicated RazorpayX desk to help our fellow startups urgently move funds from their US banks to India. For all existing RazorpayX users, we are offering to move their money into their Indian current account as FDI through our partner banks. For anyone who is not a RazorpayX user, we are helping them move their money to a Nostro account through our partner banks."

"We also understand that this event may cause a few companies to be unable to make payroll in the next 30 days. We are working things internally to see how we can help resolve it. Our teams are working hard along with our banking partners to explore all possible solutions to reduce the panic amongst founders because we know if we don’t come together and help them out now, these young disruptive startups may not see the light of day," he added.

Except for the headline, this story has not been edited by The Telegraph Online staff and has been published from a syndicated feed.