Bengaluru-Based Juspay Secures $60 Million in Financing Led by Kedaara Capital
Bengaluru-based payment aggregator Juspay has successfully closed a $60 million financing round, spearheaded by domestic private equity investor Kedaara Capital. The round also saw participation from existing investors, including SoftBank and Accel.
Valuation and Funding Details
This funding round, a combination of primary and secondary investments, values Juspay at over $900 million, as reported by sources familiar with the matter. According to business intelligence platform Tracxn, Juspay had a valuation of $440 million as of 2022.
Insiders indicated that around $10 million was directed as new capital into Juspay, while the remainder of the financing facilitated secondary sales by existing shareholders.
Involvement of Swedish Investment Firm
Juspay did not officially announce the funding deal. However, in response to inquiries from ET, a representative confirmed that Swedish fintech-focused firm VEF divested part of its 10.2% stake in Juspay for $14.8 million as part of the secondary component in this financing round. VEF had previously invested $21 million over two funding phases in 2020 and 2022.
Financial Performance
Juspay reported a net loss of ₹97.5 crore for FY2024, although this figure reflects an approximately 8% reduction from the previous year. Additionally, the company experienced a 46% increase in revenues, rising from ₹237 crore to ₹347 crore year-over-year.
Expansion into Payment Aggregation
This financing comes more than two years after Juspay raised a similar amount in a funding round led by SoftBank. Initially, Juspay focused primarily on payment orchestration for online merchants but has recently expanded its services into the broader payment aggregator space, allowing it to compete with established players in India.
Competitive Landscape and Controversy
Juspay is currently facing contention with industry counterparts, including PhonePe, Cashfree, Razorpay, and Paytm, as they are pressuring merchants to avoid using third-party payment orchestration platforms.
Understanding Payment Orchestration
A payment orchestration platform serves as a routing service that directs transactions to banks and aggregators where the likelihood of a successful transaction is maximized. This functionality is crucial for minimizing transaction failures.
Regulatory Milestone
In February 2024, Juspay acquired a payment aggregator license from the central bank, marking a significant regulatory achievement. In a December 2023 discussion with ET, cofounder Sheetal Lalwani highlighted the company’s commitment to developing innovative business payment solutions and adapting to emerging frameworks such as the Open Network for Digital Commerce (ONDC) and the Open Credit Enablement Network (OCEN).
Global Expansion Plans
Juspay has not only solidified its presence in India but has also broadened its operations into various new markets across the Asia-Pacific region, Latin America, Europe, the UK, and North America.
Advancing AI Capabilities
With the recent influx of capital, Juspay plans to enhance its artificial intelligence capabilities, focusing on developing solutions that improve workforce productivity and enrich merchant experiences.
Commitment to Open Payment Systems
“As we expand our global footprint and enhance our AI initiatives, our dedication to building open-source and interoperable payment systems remains unwavering,” stated Lalwani, cofounder and Chief Operating Officer of Juspay.
Robust Transaction Processing
Juspay currently services over 500 global enterprises, banks, and card schemes, processing a staggering 200 million transactions daily, with an annual total processed volume exceeding $900 billion.
Looking Ahead
The future looks promising for Juspay as it continues to innovate in an increasingly competitive landscape, supported by substantial investor confidence.
Conclusion
Juspay’s latest funding round showcases its growth trajectory and ambitious plans for expansion. With a strong valuation and a commitment to enhancing the payment process, the company is well-positioned to lead in the evolving fintech ecosystem.
Q&A Section
1. Who led the recent funding round for Juspay?
Kedaara Capital led the $60 million funding round, with participation from existing investors SoftBank and Accel.
2. What valuation did Juspay achieve with this funding?
The funding round places Juspay’s valuation at over $900 million.
3. How did Juspay’s financial performance change in FY2024?
Juspay reported a reduced net loss of ₹97.5 crore, with a 46% increase in revenues, from ₹237 crore to ₹347 crore.
4. What recent regulatory approval did Juspay receive?
Juspay obtained a payment aggregator license from the central bank in February 2024.
5. How many transactions does Juspay process daily?
Juspay processes over 200 million transactions daily across various platforms.
