Fintech start-up Razorpay secures $9 million in series A funding

This round was funded by Tiger Global and Matrix Partners; Razorpay's total investments till date are $11.5 mn, reports Tech in Asia

Over $1.2 billion of investor money has gone to fintech in India this year, making it one of the hottest verticals for venture capital. The reason is that e-commerce, mobile, and internet businesses are taking off, and their toughest pain-point is the difficulty in accepting payments. Often, a customer will give up because a card or netbanking transaction fails because of a connection problem or some other hitch.

A number of players have come up in the last few years – from Sequoia Capital-backed CitrusPay to Flipkart’s in-house attempt PayZippy (which has since shut down) – to try making online payments smoother and more efficient. One-year-old Razorpay, one of the few companies from India to get backing from iconic seed accelerator Y Combinator, is among the rising stars in the space.

The start-up today announced a series A funding round of $9 million from Tiger Global and Matrix Partners, and disclosed an earlier seed round of $2.5 million from Matrix Partners, Y Combinator, and angel investors, taking its total investment to $11.5 million. The angels include the founders of Snapdeal and InMobi, as well as the chief product officer of Flipkart – three of India’s unicorns.

Razorpay has focused on developing the technology to solve India-specific problems. The biggest one is the failure rate of card and netbanking transactions, which is as high as 30%-40% on the web and nearly 50% on mobile devices.

 “We have focused especially on mobile success rates where our patented technology allows transactions to work at 2G speeds, perform auto-OTP reading and reduces the overall checkout time,” says Harshil Mathur, co-founder, Razorpay.

This is an excerpt from Tech in Asia. You can read the full article here.