Scapia Secures $40 Million in Series B Funding
Scapia, an innovative travel fintech startup, has raised $40 million in a Series B financing round led by Peak XV Partners. This funding round also saw contributions from Elevation Capital, Z47 (formerly Matrix Partners India), and 3state Ventures. The company is known for its co-branded credit card developed in collaboration with Federal Bank, allowing users to seamlessly book flights, trains, accommodations, and other travel experiences through their app.
Investment in Growth and Technology
According to Anil Gateti, founder and CEO of Scapia, the newly obtained funds will be directed towards brand marketing, product development—including the incorporation of AI into customer service and operational efforts—and expanding their team. Scapia currently employs approximately 100 individuals, and they plan to increase their workforce by 50% over the next year.
Expanding Credit Card Offerings
Scapia launched its co-branded credit card in June 2023, with aspirations to partner with additional banking institutions in the near future. Among these prospective partners is Flipkart co-founder Binny Bansal. Gateti emphasizes that while their primary focus is on co-branded credit cards, the company may explore offering other financial services in the coming years.
Aiming at Millennials and Gen Z
The primary target demographic for Scapia includes millennials and Generation Z, who currently account for around 50% of credit card issuance in India. The Scapia card boasts zero annual and joining fees, coupled with no foreign exchange markup and various travel-related benefits, making it particularly appealing to young consumers.
Year-Round Rewards for Travelers
Gateti noted that customers utilize Scapia’s products throughout the year to accumulate rewards. Approximately 80% to 85% of transactions are travel-related, enabling users to earn points continuously. During their travels, customers enjoy various perks such as lounge access, no foreign exchange fees, and discounted tickets.
Potential in the Travel Fintech Market
The travel fintech sector represents a significant market opportunity, especially as Generation Z and millennials comprise half of all credit card users in India. This growing digital consumer base is expected to generate an annual revenue potential of $80 to $100 billion by 2030, according to Mridul Arora, a partner at Peak XV Partners.
Strategic Positioning for Growth
“Scapia is exceptionally well-positioned to capture a substantial share of this expanding market segment,” added Arora. Other players in the travel fintech arena include Niyo Global, which offers co-branded debit and credit cards in partnership with State Bank of Mauritius (SBM) India, as well as debit cards offered in collaboration with DCB Bank.