Razorpay raises $160 Mn at a valuation of $3 Bn

Business-focused payment gateway and neo banking platform Razorpay has raised $160 million in its Series E round co-led by Singapore’s sovereign wealth fund GIC and Sequoia India. Other existing investors who participated in the round include Ribbit Capital and Matrix Partners.

According to Razorpay, it has reached a valuation of $3 billion with the fresh capital infusion. 

This comes after six months of $100 million Series D round for the Bengaluru-based company when it entered the unicorn club. So far, it has raised $366.5 million across several rounds since its inception in 2014.

Razorpay has become the third most valued company in the fintech segment after Paytm and PhonePe. Amrish Rau-led merchant payments company Pine Labs, which is currently valued at $2 billion, is also in talks to mop up a fresh round at a valuation of $3 billion.

The fresh infusion for Razorpay will go toward scaling up its business banking suite, invest in new acquisitions and launch in international markets such as South-East Asian countries.

Razorpay provides payments solutions to more than 5 million small and large businesses such as Facebook, IRCTC, Zomato, CRED, Zerodha, Indigo among others and is all set to reach 10 million businesses by this year.

For the past 12 months, the Harshil Mathur-led company has been scaling up its neo-banking platform Razorpay X and loan marketplace Razorpay Capital. The company claims to disburse credit of upwards of Rs 700 crore per month, helping entrepreneurs get access to working capital. It further intends to scale this up to Rs 1,000 crore per month by the end of 2021. 

Razorpay's core business is payment gateway and the bulk of its revenue comes from it. According to Fintrackr, the company registered a 2.6X jump in its revenues to Rs 509 crore in FY20. While the company had posted a loss of Rs 6.15 crore during FY20, it turned cash flow positive at the operational level during the fiscal. 

Last month, the company had also announced ESOP buyback worth $10 million for its 750 employees.