Mumbai: Innoviti Payment Solutions, a payments company backed by Infosys Ltd co-founder N.R. Narayana Murthy’s Catamaran, has raised Rs120 crore in its latest round of funding from SBI-FMO and Bessemer Venture Partners, to boost its businesses across the retail supply chain.
Innoviti, a payments technology firm, helps merchants accept payments across channels such as the web, mobile, in-store or at the time of delivery. It also operates smelending.com, a platform that helps small merchants get short-term loans to manage their cash flows.
The series B round of funding was led by Singapore-based private equity fund SBI-FMO.
The fund has been set up by Japan-based SBI Holdings group, an Internet-based financial services conglomerate spun out of SoftBank, and Dutch development finance institution FMO.
The round also saw participation from American venture capital firm Bessemer Venture Partners and existing investor Catamaran, which had in 2015 participated in a Rs30 crore ($5 million) funding round. Masterkey Holdings advised Innoviti on the fund-raise.
“The new round of funding will be used to expand the market for the uniPAY Next platform and smelending.com product to target payment and lending in order to facilitate working capital loans to kirana stores, small merchants and brand franchisees right across the supply chain," Rajeev Agrawal, chief executive at Innoviti, said.
UniPAY is an offering that allows merchants to accept digital payments through various modes such as cards, wallets as well as UPI.
The company processes around Rs20,000 crore worth of transactions annually and has grown 100% in terms of value and volume of transactions over the last year, according to Agrawal.
Innoviti’s smelending.com platform enables loans as small as Rs30,000 for periods as short as 15 days. smelending.com processes more than 150,000 loans annually for over 30,000 such small businesses and has so far disbursed loans worth over $500 million.
According to Agrawal, investors are keen on investing in technology-based lending platforms focused on small and medium enterprises (SMEs).
“The cost of lending in such sectors is usually high because merchants are not aggregated geographically, so people need technological solutions and, therefore, investors are curious on this space," Agrawal added.
The fund-raising by Innoviti comes after digital payments in India received a significant boost following the government’s demonetisation drive in November and various initiatives such as Unified Payments Interface (UPI), which have eased digital transactions.
Several payments and lending start-ups have raised funds in recent times, a mark of investor interest in the fintech space.
Last month, Press Trust of India reported that PoS (point of sale) merchant acquirer and network provider Mswipe Technologies had raised $31 million from UC-RNT fund, a joint venture between Ratan Tata’s RNT Associates and University of California along with existing investors.
Last year, SMEs-focused lending platforms Capital Float and Lendingkart raised $25 million and $32 million, respectively.
“The space of digital payments in India is huge and is heavily under-penetrated. After the Indian government’s initiative and support in helping digitization, it further boosts our aspirations to invest in such businesses in India," said Suramya Gupta, fund manager at SBI-FMO Fund.
The fund also sees opportunity in taking Indian fintech start-ups to other emerging geographies, he said.
“We also see opportunity in taking Indian technology outside India. We will work with Innoviti as it has a very unique payment technology, which they have developed in-house and would definitely try to take these technologies outside, to countries like Philippines, Indonesia, etc.," Gupta added.