Zebpay, a Bitcoin wallet provider based in India, is raising a new funding round between US$4 million and US$5 million, following a US$1 million seed investment the company got earlier this year.
Like a number of new fintech and e-commerce startups in India and Southeast Asia, the company is tying mobile payments to personal mobile phone accounts, given the high rate of unbanked and underbanked individuals in India.
Zebpay is negotiating with a leading U.S. venture capital fund, according to the Economic Times, but it is not the only company in India currently raising new money for its operations.
Given India’s mix of IT know-how, rising focus on cybersecurity, large number of businesspeople working abroad and historically unbanked population, there is great interest in incorporating the use of cryptocurrencies into the Indian digital economy.
Zebpay, founded as BuySellBitco.in in 2012, is integrating Bitcoin into mobile payment services for Indian customers of Flipkart, Amazon and MakeMyTrip. Some Zebpay-backed promotions bring significant discounts to customers.
The company boasts 130,000 users, up from 25,000 just this January, according to SiliconANGLE. This round also included two Indian investors, whom the company has not identified.
“The environment in India for cryptocurrency is extremely positive, and we are planning to utilize the amount to promote bitcoins as a reliable currency and investment option,” co-founder Saurabh Agrawal told CryptoCoinse News after the seed round earlier this year.
Some are predicting a Bitcoin surge over Diwali, the upcoming annual Hindu festival, as consumer sales skyrocket. But all countries have holidays and excuses to buy gifts. There are some unique factors behind the rise of the coin in Bangalore, Mumbai and New Delhi.
India saw another recent Bitcoin investment in the US$1.5 million round of Bangalore-and-Tumkur-based Unocoin, which boasts 100,000 users and 30 employees, according to Bitcoin Magazine. That round was led by Blume Ventures, with funds also coming from Boost VC, FundersClub, Digital Currency Group and Bank to the Future.
“India has the largest gold, inward remittance and IT markets in the world — all of which make it a perfect home for Bitcoin and Blockchain technology,” Unocoin CEO Sathvik Vishwanath said after raising the round, explaining what he clearly sees as a perfect opportunity to let India take a bigger chunk of the global Bitcoin industry.
The statement is backed up by the World Bank, which names India as the global leader in receipt of remittances.
Other local startups in the space include BTCXIndia and Delhi-based Coinsecure. The latter raised its own US$ 1.2 million seed round in April and is currently hunting for “US$ 3.5-3.8 million in the next few months,” the Economic Times reports Coinsecure co-founder Benson Samuel as saying.
Coinsecure also recently announced a Bitcoin partnership with OKLink, an offshoot of China-based OKCoin, to take advantage of the remittance market in India.
India’s Fintech space grows
“Specifically, P2P lending and remittances are the current trends in the Indian Fintech space,” stated a recent report by NASSCOM and KPMG.
“Slowly a clutch of companies are beginning to look at robo-advice and bank-in-a-box as new investment avenues. Blockchain is an emerging tech-mammoth and has the potential for mass market implementation in the future,” it read.
The unbanked population makes the payments startup scene a strong one in southern Asia, where arrangements like Zebpay’s are becoming common. That also has aroused interest in Blockchain technology from India’s fintech companies, including P2P lenders Faircent, i-lend and MicroGraam.
The Boston Consulting Group said in July it expects the Indian digital payments market to reach US$500 billion by 2020. That unique payments environment played a role in the recent US$ 130 million acquisition of Pune-based Citrus Pay, whose sale indicates the payments market is maturing after Indian government efforts to reduce the number of unbanked residents.
It remains to be seen whether these four companies are just the tip of the iceberg and whether India can harness its manpower to challenge established Bitcoin centers like fintech powerhouse London.
But the demand and know-how are there, so there is a real opportunity for India to turn itself into a new hub for a very important vertical.
The article Ahead of Diwali, India bitcoin startups Unocoin, Zebpay and Coinsecure mine new investments first appeared on Geektime.
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