Ipo-Bound Pine Labs Acquires Fintech Interface Startup for $75M

IPO-linked merchant commerce platform Pine Labs has acquired fintech infrastructure specialist Setu to bolster its diversified online payments and lending offerings. Sources told CNBC-TV18 the deal is valued at between $70 million and $75 million.

Setu’s founders will continue to lead the company and brand name, and Setu’s team of 90 to 100 employees will be retained, Pine Labs said in a briefing.

Founded in 2018, Setu offers an API (Application Programming Interface) integration allowing fintech players to work closely with regulated entities such as banks, non-bank financial companies (NBFCs) and others. In August 2021, the company partnered with Google Pay to offer fixed deposits through Equitas Small Finance Bank.

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“Integrated financial services and open banking are going to be the way forward and the value of the integrated finance market is expected to surpass $138 billion by 2026 as APIs intensify the competitive fintech landscape,” said Amrish Rau, CEO of Pine Labs.

“Setu helps its customers, merchants and brands create beautiful experiences, so consumers can engage with payments and financial services on their terms. We are in the golden phase of digitalization in India, and Setu is a pioneer in supporting innovation on the Indian stack – their work on UPI and in the account aggregator space,” he added.

Rau further called Setu “a team of builders and entrepreneurs” and “along with the team at Pine Labs, will tackle hard-to-solve problems in the ecosystem.”

It is the third acquisition for Pine Labs in 2022, which took a majority stake in payment solutions provider Mosambee in April and in Mumbai-based online payments startup Qfix in February.

The deal comes at a time when Pine Labs is expanding its offerings beyond merchant payments. It is expanding its Buy Now Pay Later (BNPL) offering in Southeast Asia and entered the consumer payments space with the acquisition of Fave in April 2021.

“Pine Labs’ network of merchants and issuers, coupled with our API integration prowess, will help drive great results in managing personal finances, monitoring loans to predict default rates, credit underwriting and several other areas,” said Sahil Kini, co-founder and CEO. , SE you.

Backed by Sequoia India and Mastercard, Pine Labs has reportedly filed a confidential US listing application, seeking to raise around $500 million, according to a Bloomberg report.