San Francisco-based fintech major Stripe is set to acquire Recko, a payments reconciliation company based out of India, marking the global fintech behemoth’s first acquisition in the market.
The acquisition of Recko, which is subject to customary closing conditions, is likely to beef up Stripe’s presence in India, which as one of the world’s most valued startups hasn’t been able to set a firm foot even after four years of setting up operations in the country.
The company will automate Recko’s payments reconciliation in potentially an attempt to offer services beyond its main payments business, it said in a blogpost. It did not disclose financial details of the deal.
As part of the deal, Recko’s team will join Stripe’s remote engineering hub, helping to build and scale Stripe’s products globally. And existing Recko users would be able to use the company’s products directly.
Last April, Recko had raised $6 million (about Rs 46 crore) in its Series A round of funding led by Vertex Ventures, the venture capital arm of Temasek. A year before that the company had raised $1 million in its seed round from Prime Venture Partners.
In March, Stripe, currently valued at $95 billion, had raised $600 million. At the time of the fundraise, Stripe said that it would soon start offering its payments services to merchants in India.
Recko offers payments reconciliation services, which is an accounting process that compares two or more sets of records to confirm accuracy. Based in Bengaluru, Recko counts major internet businesses including Deliveroo, Meesho, PharmEasy and more as customers.
The deal could invigorate Stripe’s position in India which has been struggling to crack the Indian market. According to experts, sustaining operations with payments as a sole offering would be difficult for any entity. This could also be observed from the diversification of Paytm, PhonePe and BharatPe into other financial services such as lending and wealth management.
With Recko, Stripe appears to be in a better position to find a place in the overcrowded payments market which is largely dominated by PayU-Billdesk, Razorpay, Pine Labs, Paym and Cashfree.