Amazon has agreed to acquire Axio, Indian buy now, pay later startupthereby strengthening its presence in financial services in one of its fastest growing markets.
The e-commerce group, which has held a stake in Axio for six years, signed the acquisition agreement in December after carrying out due diligence, the Indian startup announced. said in a blog post.
Financial terms of the deal were not disclosed, but two people familiar with the matter told TechCrunch that the deal amount exceeded $150 million. The transaction requires approval from the Indian central bank.
The Bangalore-based startup, formerly known as Capital Float, has so far raised $135 million from investors such as Peak XV Partners, Ribbit Capital and Elevation Capital over the years.
Axio specializes in providing point-of-sale credit to self-employed individuals and households on major e-commerce platforms, including Amazon and MakeMyTrip. It claims to serve more than 10 million customers and that its loan portfolio is worth more than $260 million.
Axio and other startups like it in India operate in a market where access to traditional credit remains limited: the country has low credit card penetration and conventional banks often find small loans unprofitable.
The startup says it is trying to fill this gap with its regulated lending platform, which can quickly assess customers’ creditworthiness, helping it make credit decisions “in two clicks and five seconds.”
But like many other startups in the category, Axio has also struggled to maintain growth. Goldman Sachs-backed ZestMoney, which operated in a similar space and was once valued at $450 million, has also struggled and was ultimately purchased by financial services company DMI Group in a rescue sale last year.
The startup competes with Bajaj Finance, the Indian financial services giant that dominates the market.
Axio is the second startup acquired by Amazon in India in the past year. bought video-on-demand streaming service MX Player in June. The tech giant has so far deployed over $10 billion in the country.