Kiwi, a fintech company that manages credit cards, has raised $13 million in its pre-Series A fundraising round headed by Omidyar Network India. The company intends to increase the amount of credit cards it offers via UPI.
Nexus Venture Partners and Stellaris Venture Partners, two current investors, took part in this round as well.
The virtual credit card company last raised $6 million in May, with the help of some angel investors, Nexus, and Stellaris.
With the help of Axis Bank, Kiwi launched its virtual RuPay credit cards in June of this year. These cards enable customers to link them to the Unified Payments Interface (UPI) service on the app and make digital payments over the infrastructure.
In June 2022, the Reserve Bank of India permitted the usage of Rupay credit cards on UPI in order to capitalise on the convenience and widespread use of UPI and to further expand the credit ecosystem.
The National Payments Corporation of India (NPCI) earlier this year approved the company’s use of the fresh revenues to offer newer products over the course of the next year, including free equated monthly instalments (EMI) on UPI and eventually a credit line on UPI. The UPI service is run nationally by NPCI.
“We have successfully introduced the RuPay credit card over UPI and have observed a strong product-market fit. We now want to increase our marketing efforts, focus more on IT architecture, and maintain enhancing the user experience with this round. The cofounder of Kiwi and previous CEO of the payments network Freecharge, Siddharth Mehta, stated, “We will appoint some senior executives in this direction.
Anup Agrawal, the former head of business for PayU’s credit division, Lazypay, and Mohit Bedi, a former executive of both Axis Bank and PayU, are the other co-founders of the fintech company.
Mehta further stated that in the upcoming six months, Kiwi will collaborate with two additional banks to offer virtual RuPay cards.
With an average monthly expenditure of roughly Rs 22,000 per member, Kiwi has issued 25,000 virtual credit cards since its launch. Mehta clarified that at least 17–18 transactions are currently made by users each month.
Kiwi offers points for each virtual Axis Bank Kwik RuPay Card transaction done using its app. These points can then be redeemed for cashback in the customer’s bank account.
“The next critical step in advancing the financial inclusion journey of India’s next half billion is to ensure deeper and more consistent usage of formal credit and to increase access to affordable and convenient financial products beyond digital payments.” Treasa Mathew, director of investments at Omidyar Network India, stated, “We are excited to be leading this investment in Kiwi.
Currently, Kiwi’s clientele is primarily composed of salaried individuals from India’s top eight cities.
Kiwi intends to add more banks to the service and reach out to new customers, especially in tier 2 and tier 3 locations. Its audacious goal for the upcoming year is to issue 500,000 virtual credit cards.