BNPL platform ZestMoney raises Rs 20 Cr in debt

Buy Now, Pay Later (BNPL) platform ZestMoney has raised Rs 20 crore in debt by issuing non-convertible debentures (NCDs) through private placement to its existing investor Alteria Capital.

The company has passed a resolution to approve the allotment of 2,000 Series F2 unlisted, secured, redeemable non-convertible debentures having face value of Rs 1 lakh per debenture to Alteria Capital Fund II –Scheme I on a preferential basis by way of private placement, a regulatory filing assessed by YourStory shows.

The resolution was passed on June 6, 2022.

The Bengaluru-based startup had raised $50 million from Australian peer Zip Co Ltd. as part of its Series C funding round in September 2021.

The new round takes the startup’s total funding to about $113 million. It counts Goldman Sachs, Quona Capital, PayU, and Xiaomi among its early backers.

Founded in 2015 by Priya Sharma, Ashish Anantharaman, and Lizzie Chapman, ZestMoney offers BNPL plans of ticket sizes Rs 50 to Rs 5 lakh payable over 30 days to 24 months. It claims to have partnered with 25 banks and non-banking lenders, and works with large merchants such as Amazon, Flipkart, Google Pay, Apple, and Xiaomi to offer its BNPL services to customers.

It also provides credit information, financial counselling, and options to help users build a good credit history. Most of ZestMoney’s customers (median) are in the 23-26 years group.

ZestMoney, at present, has over 11 million registered users and a merchant network of 10,000 online and 75,000 physical stores.

In 2021, the startup had 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. The insurance firms will work with ZestMoney to co-create tailor-made insurance schemes to offer alongside its BNPL products. The platform would earn via a distribution fee from the insurance players.

With the insurance licence, Zest Money joins the likes of Lendingkart, PolicyBazaar, Amazon Pay, and Paytm Money that offer insurance online.

Recently, the Reserve Bank of India (RBI) came down heavily on BNPL players, as it barred non-banks from loading credit into Prepaid Payment Instruments (PPIs), typically e-wallets or stored-value cards. The move came after some fintech firms started using credit lines from non-banks (sometimes their own NBFCs) to offer credit services.

ZestMoney seems to be an interesting startup with spurring new development on financial services platform. I’m certain this startup would keep on flourishing in its excursion ahead. My best wishes to the entire team of ZestMoney. This will give them tremendous achievements in the future.

Shishir Gupta, Founder and CEO, StartupLanes

Don’t keep wondering about funding, you can also raise funds. Learn how to raise funds here: Yes I want to raise funds.

If you are an emerging startup and are looking for investors to raise funds, StartupLanes has its own angel network and investment banking services and is connected to angel investors and VCs in 15 countries that ensure that our member startups have easy access to external funds to scale up constantly.

You can subscribe to our news posts by entering your email in the box on the right side of this page.

Check out our YouTube channel for insightful content from the Indian startup ecosystem.

Or join our Whatsapp group to interact with other founders: Yes, I want to join the Whatsapp group.

The right investment is key to beating inflation and growing your wealth. Do you wish to become an angel investor? Yes, I want to be an angel investor. Are you a startup and facing challenges in your business? Do you want to grow your business? It is not as difficult as it sounds. Learn how to grow your business here- Yes, I want to grow my business.