BHARATPE, A NEW FACE for THE FINTECH INDUSTRY: IN TALKS TO RAISE FUNDS IN SERIES E ROUND LED BY TIGER GLOBAL, BRINGING IT THE UNICORN STATUS.11 months ago Rituka M
With the technological revolution, digital payments became frequent, and the onset of the pandemic accelerated this shift drastically. Fintech startups have gained a lot of traction over the last few years, with the Indian startup ecosystem making considerable strides in this regard. For established companies, making the digital transformation has been handy & easier than compared to traditional businesses & merchants.
In a competitive space with giants such as Paytm, GooglePay, and PhonePe, an idea that began in a dorm room has made its way to becoming the newest entrant to the coveted unicorn club. Shasvat Nakrani, an alumnus of IIT Delhi & Ashneer Grover, an experienced veteran & an alum of IIT-D & IIMA, a complementary duo envisioned a revolutionary payments application for merchants, and BharatPe was brought into fruition in 2018. With a unique proposition that differentiated itself from the competition such as Paytm, GooglePay & PhonePe who were already making business, BharatPe cashed in on the niche that none of the big boys were focusing on, the P2M (Person to Merchant) space.
BharatPe, focusing on the P2M market, blitzed into the fintech market and carved a large share for itself. Tapping into the SMB merchant market & kirana stores that did not have to the web easily, this Delhi-based startup introduced interoperable offline QR code stickers & Point of Sale (POS) machines to overcome the merchants’ technological handicap. Although the big players in the P2P UPI market drove up the customer adoption volumes, without the introduction of BharatPe’s unique proposition, it would have been quite difficult to digitally revolutionize the Indian merchant market. Realizing the value, the big players were soon to adopt the interoperable QR codes, however, BharatPe scaled in operations with investments & speed. With a quick merchant onboarding process & absolutely zero (0) transaction (Merchant Discount Rate) fees, remained key differentiators & motivators for merchants to adopt BharatPe to go digital.
Another loaded cannon that BharatPe had ideated to launch was introducing financial products such as loans to small businesses, credit cards, bill discounting insurance & digital gold through PostPe which allows credit on QR UPI & B2C app which will allow peer-to-peer lending at a 12% interest rate, where BharatPe shall act as an intermediary. To further this, they partnered with Apollo Finvest to pilot merchant loans & applied for a Non-Banking Financial Company (NBFC) license. The Reserve Bank of India (RBI), on June 21, 2021, granted an in-principal approval for the license to BharatPe & Centrum, who shall be acquiring the collapsed PMC (Punjab & Maharashtra Co-operative Bank) & assuming the liabilities & moth-eaten assets. This move by the RBI makes BharatPe, a 3-year old fintech startup, the first fintech with a Small Finance Bank (SFB) license.
The fintech startup has raised a total of $290.3M in funding over 7 rounds, with their latest funding on May 10, 2021, from a Debt financing round. Having recently raised $100M in a Series D round with participation from Coatue, Steadview Capital, Insight Partners, BeeNext, Sequoia Capital, Ribbit Capital & Amplo among others. Recent reports from The CapTable, show that BharatPe is in advanced talks with Tiger Global to raise about $250M in Series E round, giving the fintech startup a pre-money valuation of $2.5 billion, taking BharatPe to achieve the status of a unicorn. However, the round hasn’t closed yet, so the terms may change accordingly. Having served over 6 million merchants & lent money to over 100k merchants across 75 Indian cities, BharatPe has built strong relationships with SMB owners to upsell their POS/card swipe machines for card payments & extending their lending product line and has deployed over 50,000 PoS machines by November of last year.