Mobile & POS payment solutions having a ball in India, close to $12-14 mn pumped in by VCs across 4 startups

While 2014 seems to be a difficult year so far for e-commerce startups in raising funds, payment solutions have caught significant attention from venture capitalists. If we look at funding in mobile-based payment solutions over the last three months, close to $12-14 million have been pumped into startups like Ezetap, Innoviti, Eashmart and Ikaaz.

Yesterday, Bangalore-based Ezetap attracted investment from American Express for a minority stake while Innovit announced $1.6 million investment from Tata Capital and consortium of HNIs.


As per media reports, three HNIs put in approx $1 million for a minority stake in the company, and the rest came from Tata Capital as loan. The secured capital will be used to expand Innoviti’s operations in the Middle East and hiring talents.

Just a month ago, Ezetap had raised $8 million in series B from a group of investors led by Helion Advisors, Social+Capital Partnership and Nicolas Berggruen’s PE fund Berggruen Holdings, among existing investors. In the same month, Bangalore-based mobile payment platform iKaaz announced an undisclosed amount of seed investment.

Besides above startups, Delhi-based mobile POS payment app, Eashmart, raised an undisclosed amount in angel funding from CIIE, IIM-A’s incubator, and two other angel investors. In December last year, Citrus Pay raised $5.5 million in Series B funding from the Japanese online payments service provider e-Context Asia and’s wholly owned subsidiary Beenos Asia with participation from existing investor Sequoia Capital.

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So what’s driving VCs to park their funds in payment solutions?

Convenience drives consumers to adapt new technologies. We hate to stand in queue to withdraw money from ATMs while purchasing daily household needs, including internet or phone payment among several others. Startups offering Point of Sales (POS) solutions simplify payment option for consumers.

At present, India has over 900 million mobile connections and low penetration of ATMs which open huge opportunity for mobile point of sales solutions to simplify payment process across the country. Ezetap and Mswipe have developed their in-house services around devices that convert mobile phones into a card swipe machines.

Over the past six years, convenience and internal consumption market have been big factors for driving e-commerce of all formats in India. Initially, VCs had put money into travel-based e-commerce, later into etail followed by cab services and now POS payment solutions. If you see, the common belief and motivations for investment in these sectors are primarily convenience and a large market size.

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About the author

Starting his career as a crime reporter with 'The Indian Express', Jai Vardhan is a storyteller, erstwhile entrepreneur and a habitual prankster. He is inclined towards entrepreneurship, philosophy and startups, not necessarily in that order. He likes connecting the dots, breaking news, nose and beliefs - ‘To wake up in life one must fall asleep’.

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