Financial services start-up Zestmoney, which specialises in consumer credit, has raised substantial funding from global investment banking giant Goldman Sachs. According to a statement from the company, the funds so raised will be used to fuel product development and scaling up its consumer base.
"The capital we’ve raised in this latest round will enable us to accelerate product development, grow our strategic partnerships and scale our platform further," said Lizzie Chapman, co-founder and CEO, ZestMoney. The start-up was founded in 2015 by Chapman, Priya Sharma, and Ashish Anantharaman.
ZestMoney uses proprietary algorithms to measure creditworthiness and execute risk profiling of e-commerce consumers who go for equated monthly installment payments. It works with financial partners to extend loans to these consumers based on this analysis.
According to company officials, the funding comes at a time of "exciting opportunities in the Indian fin-tech space" which continue to increase on the back of large availability of cheap data and government investments in mobile payments infrastructure.
While no official numbers have been released, sources say that the round has garnered the company $15 million, with existing investors like Naspers Fintech, fin-tech-focused VC fund Quona Capital and Flourish also participating in the round. Prior to this round, Zestmoney had raised $20 million in a Series B round in April this year led by Quona.
"India is one of the most exciting fin-tech markets in the world. We see this investment in one of the country’s leading consumer lending fin-tech companies as fostering much-needed access to affordable consumer credit to Indian households. We look forward to leveraging our global experience and network for the continued growth of ZestMoney," said Philip Aldis, MD, Goldman Sachs.
Zestmoney currently has more than six million registered customers in India, and the company says that consumers can use ZestMoney to pay for purchases of any amount up to Rs 2 lakh at over 3,000 merchants, with a number of interest-free financing options available. It also pointed out that brands including Flipkart, MakeMyTrip and Paytm have integrated with ZestMoney as a prominent payment option at checkout over the past few months.
Earlier this month, the company had entered into a strategic partnership with NBFC Northern Arc Capital under which it said it would disburse USD 400 million over the next one year for EMI financing. "We are striving to develop a deeper and holistic ecosystem for expanding our palette of offerings and access to affordable EMI solutions," said Chapman had said.
Other investors also took interest
While no official numbers have been released, sources say that the round has garnered the company $15 million, with existing investors like Naspers Fintech, fintech-focused VC fund Quona Capital and Flourish also participating in the round. It had raised $20 million in a Series B round earlier