Payments infrastructure company Easebuzz has raised $4 mn as part of its seed round. The seed round was led by 8i ventures, Varanium Capital, and Guild Capital. The round also included existing investors- Pine Labs CEO Amrish Rau and Citrus Pay cofounder Jitendra Gupta.
Founded in 2017 by Rohit Prasad, Easebuzz is a digital payments enablement startup that develops API-based solutions to help businesses process digital collections and payments. In a press statement, Easebuzz said it will use the current funding to offer more payment application programming interfaces (API) and solutions for small and mid-size enterprises (MSME) and strengthen its existing portfolio. The company caters to small and medium sector enterprises and individual merchants to collect online payments for their business through debit, credit, and internet banking options. It also offers payment APIs for online businesses.
Commenting on the product vision, Easebuzz founder and MD Rohit Prasad said, “From inception, our product DNA was designed around removing friction out of every collection touch-point for an Indian SME.”
The Pune-based startup, which claims to process nearly $3 Bn in transactions annually, expects to hit a $10 Bn in annual GMV run-rate in the coming year. The company is eyeing development of a suite of services on its platform to further scale up on the digital settlements and collections API.
Easebuzz competes with other major payment gateway solution providers such as Razorpay, Instamojo, Cashfree, YAP, Y Combinator-backed Decentro and PayU in the ever-growing payments API domain. Even the likes of Paytm, Phonepe and Google Pay have launched API solutions for service providers and digital products on their respective platforms.
The government’s drive towards cashless economy has resulted in 55.1% CAGR for digital payments over the past five years, between 2015-16 and 2019-20, as per the Reserve Bank of India (RBI) data released last year. During this period, its value has grown from INR 920.38 lakh Cr to INR 1,623.05 lakh Cr, growing at a compounded annual growth rate of 15.2%. In January 2020, RBI governor Shaktikanta Das had claimed that digital payments account for around 97% of daily payment system transactions in terms of volume.
Over the last one year, numerous small businesses in India have upgraded collections from cash to digital, and payments API allow these small businesses to integrate digital payments infrastructure at a fraction of a cost compared to building a native payments system. A Redseer report has revealed that as the Indian economy rebounds from the Covid-related impact, there will be a consequent growth in digital payments, which are expected to grow 2x and touch $60 Tn by 2022.