Buy Now Pay Later (BNPL) startup ZestMoney said it has raised $50 million in its Series C round of funding from Australian BNPL fintech Zip Co Limited.
This is part of a larger Series C funding that will see participation from existing investors, ZestMoney told media.
As part of the deal, Zip will acquire a minority shareholding in the company and a seat in the management board.
The company will use the funds to expand its product suite, enhance the transaction network, boost its balance sheet and setting up new businesses in the insurance and savings segment.
Lizzie Chapman, CEO and cofounder at ZestMoney said, “The investment by Zip is a deep validation of our position as the market leader in the Buy Now Pay Later category in India. The shift towards Pay Later solutions is a global phenomenon and represents young digital consumers looking for transparency, honesty and no hidden charges in financial products.
“We believe India will leapfrog traditional products like credit cards, along with many other emerging markets, going straight to digital payment solutions,” Chapman said.
She said that over the last year the company has seen applications for BNPL go up by 5X on its platform. “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,” she added.
This transaction also marks Zip’s entry into the Indian market. Founded in Australia in 2013, Zip currently has a presence in 12 markets across five continents.
Meanwhile, Larry Diamond, CEO of Zip Co, said, “With deep partnerships with online and offline merchants and lending partners, Zest Money is poised to accelerate growth as the market develops.”