Razorpay Buys Offline Payments Firm Ezetap in Company’s Biggest Acquisition Till Date

Ezetap is said to continue to operate independently after its acquisition.

Razorpay Buys Offline Payments Firm Ezetap in Company’s Biggest Acquisition Till Date

Photo Credit: Twitter/ @ezetap

Razorpay had bought offline payments firm Ezetap

Highlights
  • Razorpay is valued at more than $7 billion (roughly Rs. 5,600 crore)
  • Ezetap will continue to operate independently after its acquisition
  • The deal will also help Razorpay cross-sell its services

Razorpay said on Thursday it had bought offline payments firm Ezetap, marking the Sequoia Capital-backed firm's latest bet on the payments industry in a deal which a source with knowledge of said was worth $150 million (roughly Rs. 1,200 crore).

Razorpay, which is valued at more than $7 billion (roughly Rs. 5,600 crore) and offers payment gateway services for online merchants, said in a statement that the acquisition was its biggest to date.

It said the deal would boost efforts to tap the offline market which still accounts for a bulk of electronic payments in India. Ezetap, whose products include point-of-sale machines, processes more than $10 billion (roughly Rs. 79,800 crore) in annual transactions in India.

Razorpay co-founder Shashank Kumar said Ezetap will help it develop in this area. "There is still a large portion of offline payments and in-person payments that we don't cover," he said.

The source said Ezetap will continue to operate independently after its acquisition, adding that the deal includes a $150 million (roughly Rs. 1,200) payment to Ezetap, with another possible $50 million (roughly Rs. 400) linked to its performance over the next year.

The deal will also help Razorpay cross-sell its services, including loan offerings, to offline businesses, Kumar said in an interview, adding that Razorpay currently serves more than 8 million businesses and processed payments worth $80 billion (roughly Rs. 6,37,100 crore) since its inception about eight years ago.

The acquisition comes as solution providers in India try to secure a tight grip on both online and offline payments.

India's Pine Labs, which for years focussed only on offline payments, last year started processing online transactions, a business from which it is targeting $4 billion (roughly Rs. 31,900 crore) - $5 billion (roughly Rs. 39,830 crore) in monthly transactions within two years, Reuters reported.

© Thomson Reuters 2022


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