ZestMoney raises $6.5 million

ZestMoney will invest the funds in technology and product development


Founded in 2015 by Lizzie Chapman, Priya Sharma and Ashish Anantharaman, ZestMoney previously raised $1.7 million seed funding in October that year.
Founded in 2015 by Lizzie Chapman, Priya Sharma and Ashish Anantharaman, ZestMoney previously raised $1.7 million seed funding in October that year.

Bengaluru-based fintech company ZestMoney has raised $6.5 million in a series A round of funding led by Naspers-owned PayU, the company said on Wednesday. Existing investors, US-based Ribbit Capital and Omidyar Network, also participated in the round along with individual investors.

ZestMoney, owned by Camden Town Technologies Pvt. Ltd, will invest the funds in technology and product development.

Founded in 2015 by Lizzie Chapman, Priya Sharma and Ashish Anantharaman, ZestMoney previously raised $1.7 million seed funding in October that year.

ZestMoney uses artificial intelligence and machine learning technology to do risk profiling of e-commerce consumers who opt for equated monthly instalment (EMI) payment option and works with financial institutions to give loans to such consumers.

“Besides using traditional data like bank statements, we have developed machine learning models to assess the consumer behaviour based on their expenses, how they interact with (e-commerce) application and product they are buying, among many other data points,” said Chapman in a telephone interview.

Currently, the company works with over 40 such e-commerce websites and has partnered with three financial institutions. The aims to work with at least a hundred e-commerce portals in next one year and it is in talks to partner with more financial institutions.

“By partnering with us, a lot of these (financial) institutions who are trying to get into consumer durable loan segment are able to do so, without having to develop their own technology,” said Chapman.

She added that consumers choosing EMIs are those shopping for consumer durable such as electronics furniture, air conditioners, among others, on an average making a transaction of Rs20,000, while it could range between Rs5,000 to Rs100,000. “Such consumers either don’t have a credit card or don’t want a credit card... and we are able to provide them with credit on transactional basis”.

The company is looking to expand risk profiling to product categories such as travel and education in 2017.

“ZestMoney has achieved good initial traction in providing credit to online shoppers and we are excited to partner with them... The investment of minority stake in ZestMoney is part of the larger vision of PayU’s credit portfolio strategy.” said managing director of PayU India, Jitendra Gupta, in a statement.

The investment in ZestMoney is in line with PayU’s strategy to grow its financial services footprint across emerging markets like India.

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