India-based Digital Bank Nupay Secures Investments via Round Led by Venture Catalysts

The rapidly evolving digital banking sector has been receiving a significant amount of venture capital investments. India-headquartered neobank Nupay recently acquired an undisclosed amount of capital from several investors led by integrated incubator and accelerator platform, Venture Catalysts. Navin Puri, ex-country head of Branch Banking at HDFC Bank, and Vishwadeep Bajaj, CEO at ValueFirst, also took part in the round.

Established by Alok Arora, an experienced financial industry professional, and IIMC alumni Neeraj Singh, Nupay is a business payments platform that allows users to conduct banking transactions, contextual payments, receivables and payables automation for large firms, governments and small-and-medium-sized enterprises (SMEs). Nupay’s management intends to use the capital raised to further expand its line of products and services.

Nupay aims to take advantage of its strategic banking partnerships (Open APIs), client ERP integration and artificial intelligence (AI) / machine learning (ML) capabilities to fully automate the account receivables and payables process. This should assist companies in reducing the cycle time, enhance cash flows and offer improved bank reconciliation services.

Dr. Apoorv Ranjan Sharma, president & co-founder at Venture Catalysts, stated:

“As India’s Fintech sector continues to flourish, it is neo-banking that presents the next big opportunity. The global neo-banking market expected to grow up to $394 billion by 2026. India, too, has started to experience the neo-banking revolution.” 

Sharma revealed that 50% of the neo banking companies were launched in 2016-17 and have attracted substantial investments from large venture capital firms and major financial institutions. India’s online payments industry is projected to be valued at $1 trillion by 2023, Sharma confirmed.

He also noted:

“We believe Nupay is perfectly positioned to capitalize on this and help enterprises digitize and automate their banking requirements.”

Nupay has teamed up with established banks including IndusInd Bank and Yes Bank allowing them to gain access to innovative technology while bringing greater transparency into their business operations. The firm’s customer base includes firms like Yatra, StarAgri and Aditya Birla Capital. Nupay has reportedly been handling INR 4 billion (appr. $56 million) worth of transactions each month.

Alok Arora, CEO and co-founder at Nupay, remarked:

“We are delighted to have Venture Catalyst as our investor, this is a validation of our belief in building India’s first Neo banking platform in India focussed on high-value and high-transacting enterprises.” 

He also mentioned:

“We have seen a surge in demand from large and mid-sized clients and banks that are looking at a comprehensive and innovative platform to manage their complex needs and dynamic requirements.”

India-based digital banking firm epiFi recently secured $13.2 million through a seed round from Sequoia Capital, Ribbit Capital, and Hillhouse Capital.

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