Investors are showing immense trust in three types of startups – fintech, edtech, and social media. Exponential growth in firms like Cred, Groww, ShareChat, Byju’s is some of the examples to prove the claim. Their operations got an exponential boost during the pandemic. Razorpay, a fintech startup, has also shown a surge in its operations and valuation. In a recent financial round, the firm has raised $160 million at a valuation of $3 billion. Since October 2020, the fintech firm has trebled its valuation.
Financial Growth of Razorpay
In a recent statement released by Razorpay, the firm has revealed that it has completed a new funding round to raise $160 million. Sequoia India, GIC led the recent financial round to surge Razorpay’s valuation to $3 billion. GIC is a Singapore based investor. Overall, Razorpay has tripled its valuation to $3 billion from $1 billion in the last six months.
Ribbit Capital and Matrix Partners, existing investors of Razorpay, also contributed to the latest funding round. It shows the huge interest of investors in fintech and digital payment gateways in India.
Razorpay, a Bengaluru based fintech firm, joined the unicorn club in October 2020 when it raised $100 million from GIC and Sequoia Capital. Recently, the firm is one of the fastest-growing fintech startups in India with exponential growth in its valuation.
Other fintech firms including Cred, Pine Labs, Groww are also showing rapid growth. Credit card payment platform Cred, and stock brokerage firm Grow recently joined the unicorn club whereas merchant payment service provider Pine Labs got unicorn status in 2020.
Fund Utilization and Business Expansion Plans of Razorpay
Razorpay will utilize this funding for expanding its operations into Malaysia, Indonesia and Singapore. The firm also wants to buy a SaaS startup. After looking at the current demand and popularity of the fintech startup, the firm is on the way to hire 600 more staffs in India and overseas to strengthening its neo banking offering. Neobank Razorpay X is the latest service started by Razorpay to offer digital banking services to its users.
South-East Asia(SEA) is a favourite business destination for Indian startups. Other than Razorpay, Pine Labs is also looking to spread its wings in SEA.
Razorpay is an online payment service provider. It helps its clients to collect payments through its online gateway service. Firms like Zomato, Swiggy, Cred, ICICI, and Ola are the proud customers of Razorpay. It also helps small business firms to manage financial transactions economically and efficiently.
In a statement, the company revealed that it provides payment services to more than 5 million small business firms. Razorpay X, a neo banking platform of the firm, helps its subscribers to maintain a current account. It also helps its clients to get loans from its partner banks. As per Razorpay data, the firm facilitates Rs 700-800 crore loans every month for its Neobank users. The startup also provides corporate credit cards in collaboration with licensed lenders.
Commenting on the latest valuation surge, Mathur, CEO of Razorpay, said:
“There is money aplenty for fintech startups that are managing their unit-economics well, but investors are steering clear of early-stage startups with riskier business models.”
Talking about the lending license, Mathur said:
“Razorpay has no plans yet to apply for a lending licence. We want to focus on our strengths which is a tech and platform solution for enterprises looking to solve their banking needs.”
BillDesk, CC Avenues, Paytm and PayU are the major competitors of Razorpay.