Thursday, May 19, 2022

Daily 10 fintech update” Kotak Bank acquires KFin, ePayLater raises money and more.

1. DG Financial Technology acquires majority stake in Pune based Vizitech Solutions

DG Financial Technology Inc. is a leading Japanese payment service provider. It has acquired a majority stake (60% outstanding shares) in Pune-based Vizitech Solutions.

This deal is another addition to the growing activity in the cross-border mergers and acquisition market. There has been an increase in demand to acquire well run companies that have successfully navigated pandemic induced challenges.

Read more about it here.

2. How Chinese Fintech companies have met with an unfortunate destiny?

The Chinese Fintech industry has entered into a new era with the clampdown of Chinese big tech companies, which were once a part of the most dynamic markets across the world.

The new laws and regulations make it hard for large firms to squeeze out the competition or harm the market or even consumer rights. The crackdown that started in 2020 has a long way of repercussions.

Read the whole breakdown of the Chinese crackdown on the big tech industry here.

3. From ClearTax to Clear: how the Indian fintech startup ecosystem’s vanguard is slowly becoming a full-stack financial company

Clear, formerly known as ClearTax was started by Archit Gupta, an IIT Guwahati alumnus. After completing his master’s in computer science from the University of Wisconsin-Madison, he went on to work at Data Domain Inc, an IT company based in Silicon Valley. His experience and learnings there, compounded by the company’s massive $2.1 billion acquisition by EMC, strengthened his conviction to set up his own startup.

So for the same, he teamed up with his father, Raja Ram Gupta, a chartered accountant, and founded Free Income Tax efiling in India for FY 2020-21 (AY 2021-22 ) : ClearTax | Upload your Form-16 to e-File Income Tax Returns.

Read more about the company here.

4. Fintech startup ePayLater raises $10 million from investors

The startup, ePayLater specialises in a pay later platform for small businesses. It raised $10 million from investors that include Zurich-based Responsibility Investments AG, Blue Ashva Capital, Pravega Ventures and others, the founder said.

The firm plans to use the fresh capital to expand its reach across more retailers and enhance its suite of products.

Read more about it here.

Interested to know more about Pay Later, you can check out our course here.

5. Kotak Bank acquires fintech firm, shares rise

Kotak Mahindra Bank, India’s third-largest bank by market capitalization, informed stock exchanges that it will initially buy a 99% stake in local fintech firm KFin Technologies. Kotak said it will give the firm a primary infusion of capital worth INR31bn ($400m) for a stake in the leading investor-and issuer-servicing platform provider.

KFin provides financial technology solutions across a broad spectrum of asset classes covering mutual funds, alternatives, insurance and pensions. It serves 23 mutual funds and pension managers across Asia, including Malaysia, the Philippines, Singapore and Hong Kong. KFin is also a leading player in the alternatives and private wealth management space.

Read more about it here.

Interested to know more about Digital Payments, you can check out our course here.

6. Pine Labs Acquires $100M from Invesco Developing Markets Fund

Pine Labs is one of Asia’s leading merchant commerce platforms. Earlier this week, the company revealed that it has finalized a new investment round in the company “with the entry” of Invesco, a US-headquartered investment management firm.

Invesco Developing Markets Fund has reportedly invested $100 million in Pine Labs.

The latter provides BNPL as well which is the hottest segment in Fintech India right now.

Read more about it here.

7. PayTM will infuse money into Nearbuy

Nearbuy will be allotting 1,30,00,000 unsecured optionally convertible debentures (OCD) to Paytm’s parent company, One 97 Communications Limited. In 2017, Paytm acquired Nearbuy and Little and merged the two startups and made a strategic investment in the combined entity.

Paytm is also heading for India’s largest IPO INR 16,600 Cr IPO issue after Coal India which had raised INR 15,000 Cr.

Read more about it here.

8. Safety in a ‘champion’ index.

The unique position of banks that allows easy access to low-cost capital makes them a safe investment option. For the last decade, neither FMCG nor IT sector has outperformed the Nifty 50 index but the banking sector has.

With NBFCs entering the arena because of easy access to low-cost capital, there is a new trend of getting merged with the banks to give birth to a new entity as it happened in the case of IDFC Bank.

Read more about it here.

9. How digital lending is transforming banking?

There is a strong demand for consumer credit across the country in different income segments and demographics. The FinTech ecosystem has seen a meteoric rise since the last decade. These two have come together to give birth to digital lending services, thus making the loan procurement process easier than before.

This popularity is not limited to only big metropolitan cities but also to the semi-urban and suburban areas.

Read more about it here.

10. How will the central bank digital currency work in India?

CBDC has become quite popular in China after its pilot project launch. With China, other countries and associations are also looking forward to bringing it into their economy.

RBI is working on a phased implementation strategy for a CBDC and the pilot may be launched by the end of this year. PwC India has listed four main uses of these internet currencies namely: programmable payments, cross border remittances, retail payments, MSME lending.

Read more about it here.

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