India’s is in talks to acquire a stake in Go Digit Life Insurance, two sources with direct knowledge of the matter told Reuters, as the country’s third biggest private lender seeks to tap a fast-growing insurance market.

Axis is planning to take a 10% stake for around $9 million in the start-up’s upcoming life insurance business, effectively valuing the business at $90 million, said the two sources, who declined to be named as the talks were private.

The move comes after India‘s biggest private lender

said in a stock exchange disclosure last week that it planned to buy a 9.94% stake in Go Digit Life for up to 700 million rupees ($9 million).

Start-up Digit, which already works in the general insurance business, is foraying into the life insurance market with its “Go Digit Life” venture.

A Digit spokesperson declined to comment, saying the company had not yet received a licence for its life insurance business. Axis did not respond to Reuters’ request for comment.

Go Digit General Insurance, Digit’s general insurance business, says it is valued at $4 billion and backed by Canadian billionaire Prem Watsa and Sequoia Capital. It offers products such as health, travel and automobiles coverage.

Axis’ plans underscore growing interest in India’s lucrative insurance business from private lenders, one of the sources said, adding that the partnership with Digit could help Axis fulfill its insurance ambitions.

India’s life insurance market, the world’s tenth biggest, remains largely untapped. Life insurance penetration – which is measured by the country’s life insurance premium as a percentage of its gross domestic product – grew to 3.2% in the fiscal year to 2021, up only slightly from 2.15% two decades ago, according to data from India’s insurance regulator.

While Axis currently offers some insurance products in partnership with

, the Digit deal may give Axis a better understanding about the online insurance industry and allow it to improve outreach to insurance customers with its own banking offerings, the source said.

Insurance companies in India are increasingly luring customers with online offerings, promising instant policy issuance and easier claims. The sale of insurance through traditional agents remains popular in India, particularly in small towns.

Go Digit General Insurance recently filed papers to raise at least $440 million via an initial public offering, eyeing a valuation of $5 billion. Its founder Kamesh Goyal is an industry veteran who previously headed the India joint venture of Germany’s Allianz.

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