Zip Co (ASX:Z1P)
is set to invest $69 million (US$50 million) in the Indian buy-now-pay later operator ZestMoney.
Zip Co recognised ZestMoney as one of India’s fastest-growing BNPL providers, with 11 million registered users, over 10,000 online merchants, and a point of presence in over 75,000 physical stores. The deal will see the buy-now-pay-later giant acquire a minority stake of less than 50 per cent in ZestMoney, by investing funds to subscribe for Series C preference shares.
Zip negotiated terms to increase its stake over time, and acquired a seat on the board. Zip noted that the deal aligns with its strategy to build a "truly global BNPL business that supports regional and global partners in multiple markets, providing everyone, everywhere with access to fair and transparent payment products."
Zip's CEO Larry Diamond said, "While buy now, pay later is emerging as a preferred mode of payment globally, in India it also plays a crucial role in driving access to credit."
Zip Co has participated in a number of acquisitions this year, and the company said the investment has been executed in a similar way to the US Quadpay acquisition last year.
Shares in Zip Co (ASX:Z1P)
are trading 4.5 per cent higher at $6.52.