Zaggle Wins $20 Mn Order From Visa For Co-Branded Forex Cards

Listed prepaid cards major Zaggle has received a significant order from the global payments major Visa for making prepaid forex cards.

The deal, which will be worth $20 Mn, will last five years, Zaggle said in an exchange filing. Partnering with Visa is also being seen as a growth agreement by the listed startup, as mentioned in the exchange filing.

Visa will pay Zaggle the launch bonus when the prepaid forex cards are launched, along with incentives based on the number of transactions that take place via the said cards. The listed startup also noted that it could leverage its existing corporate base to sell forex cards to the employees of those companies and expand its user base.

The deal propelled Zaggle’s stock price to a new 52-week high of INR 247.70 during intraday trading on Friday. As of 12:39 PM on Friday, the company’s shares were trading at INR 244 apiece, nearly 13% higher than Thursday’s close. Compared to its listing price of INR 164, the current share price is 48% higher.

The startup, which went public in September, saw its public issue oversubscribed 12.57X on the last day of its IPO. The issue received bids for 24.29 Cr shares as against 1.93 Cr shares on offer, led by qualified institutional buyers (QIBs).

Zaggle, founded in 2012 by Raj P Narayanam, makes network-agnostic prepaid cards for corporates as rewards and reimbursement vehicles, along with fintech SaaS solutions for expense management. Over the past 11 years, Zaggle claims to have provided over 5 Cr prepaid cards in the Indian market, with over 2,400 lifetime B2B customers. 

As per its red herring prospectus (RHP), Zaggle’s profit after tax (PAT) declined to INR 22.9 Cr in the financial year 2022-23 (FY23) from INR 41.9 Cr in the previous fiscal. Its operating revenue jumped to INR 553.5 Cr in FY23 from INR 371.2 Cr a year ago.

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