Chandigarh-based fintech startup PayMart India, on Thursday (January 8), announced that it has raised a fresh funding round led by IIM Ahmedabad’s incubator, CIIE.CO. Angel network Chandigarh Angels and a few Delhi based angels also participated in this round.
The startup aims to provide cash to its users, however, without using any ATM or POS machines. PayMart serves as a platform that provides cardless cash withdrawals through small merchants shops and brick and mortar stores.
A user can send money digitally to merchants via PayMart’s online platform. As of now, the payment modes available on the merchants-enabled cash withdrawal platform are unified payments interface (UPI), SBI Pay, SBI Buddy, among others.
Moreover, PayMart also helps merchants to use excess cash to give credit to individuals. This additional feature provides merchants to earn some extra income through commissions and incentives.
PayMart was founded by Amit Narang in 2015, who was also the founder of FX Mart, which was later acquired by Flipkart. Notably, FX Mart is the same company that Flipkart has rebranded as Phonepe and is now one of the largest payments companies in India.
Though the digital payments space in the country has ramped in the recent past, India still remains a cash-driven economy. Highlighting the dearth of ATM facilities in India, Narang said that even today, 62% of the population is being catered by 40K ATMs only and people have to travel at least 3 to 15 Kilometres just to withdraw the cash. To solve this problem, PayMart endeavours to convert next door merchants into virtual ATMs by tying up with various banks across the nation, Narang added.
Prior to this, PayMart, in July 2019, had raised an undisclosed amount in a seed round, led by Chandigarh Angels Network (CAN).
According to a recent report by NITI Aayog — Digital Payments (2018 edition), India’s digital payments industry is estimated to grow to $1 Tn by 2023. The report also highlights that the value of digital payments will likely jump from the current 10% to over 25% by 2023.
Moreover, since the incorporation of UPI in the digital payments space, the Indian fintech sector has been going through a transformation phase along with the growing internet penetration.