Naspers-owned online payments platform, PayU is leading a financing round in consumer lending startup ZestMoney, people familiar with the development told. The $3.7 million fund raise will give PayU a 20% stake in ZestMoney and see existing investors Ribbit Capital and Omidyar Network also participate.
The funding from PayU comes on the back of its $130 million Citrus Pay acquisition making the combined entity a dominant player in the e-commerce payments market. South African media and internet group Naspers had kept away from striking fresh deals over the past two years but has made a comeback with two significant mergers, PayU-Citrus and Makemytrip and Goibibo, over the past few months in India.
The investment in ZestMoney is in line with PayU’s strategy to grow its financial services footprint across emerging markets like India.
The ZestMoney platform enables instant account opening and real time credit approval, combined with digital loan servicing and repayments technology, according to the company’s website. The venture partners with e-commerce firms to enable financing at the checkout, enabling EMI without credit card.
In September, PayU acquired Citrus Pay, in an all-cash transaction, signalling its intent of bulking up its financial technology play here. Naspers CEO, Bob van Dyik, said the group would look at backing early-stage startups after having largely kept away from ploughing fresh capital during 2014-15 which saw a slug of money come in from myriad investors inflating valuations for young startups.
“We have a dedicated investment team in India. If we see things we like with the right entrepreneur, we will back it. We are funding a lot of growth in Flipkart, PayU, OLX and combined travel business where we are spending money, which is not visible to the outside world. They are not restricted or required to spend a certain amount of capital as we invest off the balance sheet,” Dyik had said in an October 24 interaction.
Naspers has an venture investing arm headquartered in San Francisco with an office in Bengaluru which spots early-stage tech startups.
Source: The Times of India
