Zip will acquire a minority shareholding in the fintech startup and a board seat as part of the investment, according to a statement released on Wednesday. The BNPL company operates in 12 countries, serving more than 7.3 million customers and over 51,000 merchants.
ZestMoney will use the capital to expand its product suite, deepen the merchant network, strengthen its balance sheet and launch new business lines in insurance and savings.
Founded in 2015 by Priya Sharma, Ashish Anantharaman and Lizzie Chapman, ZestMoney uses artificial intelligence and machine learning to onboard customers, offering them BNPL plans of ticket sizes Rs 50 to Rs 5 lakh payable over 30 days to 24 months. It has partnered with 25 banks and non-banking lenders for BNPL solutions and provides credit information, financial counselling and options to help users build a good credit history.
“We believe India — along with many other emerging markets — will leapfrog traditional products like credit cards, going straight to digital payment solutions. Over the last year, we have seen applications for BNPL go up by 5X on our platform,” Chapman said. “We continue to invest in deepening partnerships with our merchant network and hiring the best talent. We strongly believe India will emerge as the largest BNPL market in the world over the next five years.”
ZestMoney, at present, has 11 million registered users and a merchant network of 10,000 online and 75,000 physical stores. It recently secured the corporate agent licence from Insurance Regulatory and Development Authority of India (IRDAI) allowing it to offer and enable insurance products to users on its platform.
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“While Buy Now, Pay Later is emerging as a preferred mode of payment globally, in India it also plays a crucial role in driving access to credit,” Zip Co CEO Larry Diamond said. “With more people using digital payments and online shopping, ZestMoney can positively impact hundreds of millions of lives in the coming years.”