This announcement appears in TechCrunch and provides a brief recap of a new funding round for an India-based fintech named PayMate, which specializes in procure-to-pay software and services for corporates and SMEs. The company started in 2006, so we typically refer to these as mature fintechs, being around for > 10 years. The piece indicates a funding round of $25 million (USD) including Visa.
‘In an interview with TechCrunch, Ajay Adiseshann, founder and CEO of PayMate, said the startup has already raised a substantial amount of the $25 million it is eyeing in its Series D. These funds came from Recruit Strategic Partners, Brand Capital, Visa, and existing investor Mayfair 101. Adiseshann said he expects the round to close in 60 days.’
Reviewing the company website reveals that offers include payables and receivables automation, supply chain automation (e-invoicing & e-procurement included) and working capital solutions, which points to commercial cards. The article does point out that PayMate has an existing Visa relationship, which we assume means that Visa card issuing banks will be providing the lines. However, other forms of credit availability have been added through an acquisition, so it seems an SME lending facility and invoice discounting capabilities are now standard offers.
‘Last year, PayMate acquired Z2P Technologies, a startup that offers lending technologies, to bring lending stack on its platform. It looks at transactional data on its platform to score SMEs and offer them credits from third-party lenders. PayMate also serves as a discounting marketplace, allowing large enterprises to electronically negotiate offers with SMEs…..In India, and same is true of some other markets, small and medium businesses often struggle to secure financing options from major banks. “India is a very collateral-based in financing. On our platform, we have the visibility of their transactional data,” he said. This helps establish transparency and trust between all the stakeholders.’
The added capital will be used for international market expansion, according to the article. One thing we will point out is that during a brief review of the company background, we found another fintech with the same name based in Australia. The remit for the Australia company is merchant acceptance, not the broader procure to pay space. There seems to be some indirect connection that might pre-date the creation of the India PayMate in 2006, but would have to speak with the parties involved.
Overview by Steve Murphy, Director, Commercial and Enterprise Payments Advisory Service at Mercator Advisory Group