GOLDMAN SACHS LEADS $15M ZestMoney INVESTMENT IN INDIA
American Goldman Sachs leads $15M ZestMoney funding aimed at helping millions of low-income earners in India to secure loans and make their online shopping a dream come true. Goldman Sachs is one of America’s biggest banks that have invested greatly in fintech startup like ZestMoney and many others.
The subject startup raised its first funds in April this year, and according to the co-founder and chief executive ‘Lizzie Chapman’ response to this development, Lizzie made it clear that the current funds are part of extended Series B round. However, ZestMoney in its yesterday publication – announced that it has raised $15 million from Goldman Sachs which also saw the participation of other existing investors such as Quona Capital, Naspers Fintech, and Omidyar Network.
The use of credit cards in India is at its very minimum despite the country’s population, and before any bank could issue loans to low-income earners, the individual’s creditworthiness must be verified as banks heavily rely on this as evidence.
On the other hand, ZestMoney is designed in a way that other data points and artificial intelligence (AI) are deployed to help this category of people build a profile that eventually makes them credit-worthy. Prior to this development – Goldman Sachs leads $15M funding, it’s been figured out, the startup has partnered with over three thousand (3,000) merchants which includes Indian Paytm, Amazon, and Flipkart that will potentially offer financing options to customers at the point of transaction.
A good number of startups in India that have established a partnership with virtually all online payment processor such as Cashfree, CCAvenue, BillDesk, and PayU have entered a deal with Chinese smartphone maker Xiaomi and Pine Labs, and as such, has been able to deploy thousands of point-of-sale machines across the nation.
Also to note is that, small loans are usually unprofitable to financial institutions such as banks, which an appreciable number of Indian startups have stepped in to address, precisely the issue of drafting cheques with less incentive.
According to reports, the subject startup also raised an unspecified amount of debt, which ZestMoney uses to finance credit to customers. And in a bid to expand its digital lending, the startup recently entered a strategic partnership with Credit Saison – a Japanese financial service company, an affiliate to Mizuho Financial Group that will help ZestMoney deploy $100 million.
It’s evident, ZestMoney is poised to disburse credit worth $1 billion within eighteen months and in the process, will enable the startup to attain 300 million users per day.
Responding to this development, a managing director at Goldman Sachs ‘Philip Aldis’ stated that, “We look forward to leveraging our global experience and network for the continued growth of ZestMoney”.
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